Uganda to scrap international call tax – End of a law of unintended consequences

Telecoms

The government of Uganda is proposing scrapping the USD0.09 per minute tax which is currently levied on incoming international calls. According to local newspaper The Daily Monitor, Ugandan telcos have complained that many calls are illegally routed through neighbouring countries such as Kenya and South Sudan which are part of the One Network Area scheme and are consequently billed as local calls, losing money for the legitimate operators.

The Excise Duty (Amendment) Bill 2016 states: ‘The complete removal of the duty was necessary due to unregulated operators routing incoming international calls via One Network Area countries and other routing mechanisms, which had led to a significant reduction in the volumes of inbound traffic and interconnect fees for the resident telecom operators.

This had a corresponding negative impact on the tax revenues generated by the resident operators.’ While traffic on international calls fell to 3.3 million minutes in December 2015, from nine million twelve months earlier, the traffic originating from Kenya and South Sudan more than doubled over the same period.
Source: Telegeography 14 April 2016