Uganda has challenged social media tax to consider :: Kenya

Uganda reviews its decision to impose taxes on the use of social media and on mobile money transactions, as a result of a public reaction.

Prime Minister Ruhakana Rugunda made the announcement shortly after police dispersed a protest against taxes.

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President Yoweri Museveni lobbied for taxes to increase government revenue and end "gossip" on WhatsApp, Facebook and Twitter.

Critics accused the 75-year-old of trying to stifle dissenting voices.

The social media tax targets the use of what is called over the top (OTT) services, which offer "voice and Internet messaging," according to an earlier statement from telecommunications companies.

Users are encouraged to make an electronic payment before they can access the sites.

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The tax on social media is 200 Ugandan shillings [$0.05, £0.04].

Activists say that while the amount may seem small, it is a significant part of what the poorest people pay to connect to the Internet.

There is also a 1% tax on the total value of mobile money transactions, affecting the poorest Ugandans who rarely use banking services.

The taxes came into effect at the beginning of the month.

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It is unclear how much revenue the government had hoped to raise through taxes.

Some have used virtual private networks (VPNs) to pay.

In a statement to parliament, Mr. Rugunda said: "The government is reviewing taxes, taking into account public concerns and its implications for the budget.

"The President provided advice on this issue and encouraged further discussions with a view to reaching a consensus on how we should raise the much-needed revenues to finance our budget."

A revised budget is due to be tabled in Parliament on July 19.

Earlier, police arrested two people and fired tear gas and ammunition into the air to disperse a demonstration of about 300 people, reports the AFP news agency.

The protest was led by famous Ugandan singer and independent MP Robert Kyagulanyi, known by his fans as Bobi Wine.

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He said on Twitter that the police tried to stop him, but failed after protesters rallied around him.

Police spokesman Luke Owoyesigire said the protest was illegal and some police officers had been attacked.

million. Museveni wrote to the Ministry of Finance in March, asking for the introduction of the social media tax to help "deal with the consequences of the olugambo [gossiping]".

State Finance Minister David Bahati later told parliament that the new tax would help Uganda repay its growing national debt.