First support artistes, then collect taxes

A surprise tax-the-entertainment-sector plan announced by the Uganda Revenue Authority in December 2022 has unsettled many musicians, event promoters, comedians, performers, producers, and hotel owners.

The announcement ends days of unpaid taxes and informal fee payments, which guaranteed a gilded life for entertainers. The plan aims to effectively end the tax dodges by musicians and bring the entertainment industry, which the government sees as a big moneymaker, into its taxable loop and shore up the national purse.

URA has revealed that Uganda has only 2.7 million registered taxpayers out of an estimated 10 million potential taxpayers in the country. Seven or eight million people earning an income are not paying income tax because they are operating informally. Though the URA move is laudable, musicians and other stakeholders have some issues that need to be addressed to allow a smoother tax collection exercise.

Singer Moses Ssali, aka Bebe Cool, says the government “should come with two hands, and not one. Come with a hand that picks the tax and another, which protects us because very few musicians understand the importance of taxes.”

“Is the government trying to help us create jobs or is it so desperate to tax musicians? This is the only sector where uneducated people earn and live and, therefore, the government must be sensitive about our issues,” he said.

He opines that the government needs to understand the informal sector and introduce options that can allow every individual to feel comfortable paying taxes.

“The sector is so big. The government shouldn’t discourage young people from being creative because of taxes. My stand is simple; they should come up with standard fees because VAT, income tax, and others are not applicable to our sector except PAYE. In an interview, singer Bruno Kiggundu, aka Bruno K, stated that the URA will have difficulty collecting taxes from the entertainment industry. “I am sure many people in the sector will be jailed because they will not pay.”

He said the government has failed to pass the copyright law and implement the strategy of playing 95% Ugandan content, including films, music and others.

“If the government implements some of these things, people will feel comfortable paying taxes,” he said. He said some musicians promote music through social media channels such as Facebook, Twitter, and others. The government blocked Facebook. It’s coming up to three years now.

“I am one of those people who promote and push my music through that application. Right now, my Facebook ad account is blocked. Most ad accounts in Uganda have been blocked, and the government does not care. All they are thinking about is taxing the industry. What have they done to help us?

“The Nigerian government injects a lot of money into the entertainment sector. It implemented the strategy of playing 97% Nigerian content in the country, and that has worked. The message is loud and clear. “Let the government first support the artistes, then it will be easy for them to pay taxes.”