Government seeks to tax cash bank withdrawals

By Ritah Kemigisa

The ministry of finance has moved a proposal to start taxing cash withdrawals from commercial banks.

In a February 9^th, 2021 letter, the treasury deputy secretary Patrick Ocailap has asked the Bank of Ugandan Governor Emmanuel Mutebile  to give his opinion on the matter, not later than tomorrow, Friday, February 12^th.

According to the ministry, whereas mobile money withdraws are subject to a 0.5% excise duty, at the counter, agency banking and ATM withdrawals are not subjected to the same tax.

Ocailap says taxing cash withdrawals will not only improve tax compliance and increase revenue but will also encourage cashless transactions which will promote e-commerce.

Ocailap says the decision follows a budget consultative meeting held on February 5^th, 2021at the ministry between the Uganda communication commission, URA, Telecom operators and bank of Uganda.

Written by Noelyn Nassuuna