New mobile money tax law might help refill govt coffers, but the knock-on effects are a lot more complicated

"Dear valued client, in application of the Finance Law, starting 01 January 2022, a 0,2% tax is applied to transfer and withdrawals.Thanks for your understanding" -an MTN message said

Beginning January 1, 2022, the Cameroon Government set an imposed mobile money tax on all sending and receiving transactions, and though many citizens think the government is trying to refill its wracked coffers, it’s a plan that could be a lot more complicated on the surface

As 2022 begun, telecommunications networks MTN and Orange sent out messages announcing the start of the new laws

Dear valued client, in application of the Finance Law, starting 01 January 2022, a 0,2% tax is applied to transfer and withdrawals.Thanks for your understanding” -an MTN message said

But Cameroonians have raised a cry for help to the charges that are being applied for both sending and receiving transactions

Following the law, 0.2% tax will be applied to all transfers and withdrawals.

For example, if sending 100,000frs costed 300frs, the law demands an additional 0.2% of 100,000 frs which is 200frs

This means the sending fee will be a total of 500frs, plus, the receiver will have to pay charges when they withdraw

Mobile Money is currently one of the most used means of money transaction in Cameroon and the law has left entrepreneurs, students and other citizens in deep worry.

Following statistics, the tax law will remove from struggling citizens and generate the Cameroon government a whopping 25 billion frs in 2022 (that’s if the volume of transactions do not increase)

Rebecca Enonchong, Cameroonian tech entrepreneur hasn’t been indifferent since the implementation of the laws.

On twitter, she shared her througts about the new tax laws

12,151 billion FCFA of financial transactions via mobile money were recorded in Cameroon in 2020. With a similar transaction volume in 2022, the State could collect up to 25 billion on the mobile money segment alone“–Enonchong said, adding that the new mobile money tax will especially hit the poorest, unbanked segments of Cameroon society.

“There is no such tax on wire transfers through banks. And it’s paid twice. Once to send. Once to receive. And all for what? To pay for government excesses and corruption.”

On social media Cameroonian has been protesting the new tax laws. Comedians has released videos, writers, entrepreneurs, citizens have all been left with the effects

The government hasn’t made any further statements but another thought said it could be a strategy for the government to curb down on the profits foreign companies like MTN and Orange make, st the detriment of home based institutions like express union, western union, emi money

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