New Mobile Money Tax in Cameroon: My Observation (BBC) – Javnyuy Joybert

According to the new finance law, The tax is applied to all transactions carried out through all the traceable platforms except for bank transfers and electronic transactions carried out to pay taxes and customs duties.

That is, people using mobile money platforms will incur added charges of 0.2% when sending and 0.2% on withdrawals. The taxes come to augment the fees that some people have been grumbling about and managing. It should be noted that, the mobile money service fee has over the years been consistently increasing.

Cameroon Taxpayers Association issued a statement denouncing the move as double taxation which I totally agree with the association. Mobile Money Operators already pay VAT for the charges they normally collect to the government and now the government will make additional 0.4%…double taxation in effect.

I also think it is a smart move from the government…they are bringing this when mobile money has been so established, almost anyone who has a mobile phone with phone number has mobile money account. Almost everyone, especially among the middle class and low income earners uses it to carry out different financial transactions.

But then, a Government with the right strategy should always be intentional in seeking ways to remove barriers around what can hinder the movement of money, people and goods. It is the movement of cash that makes an economy. The ripple effect of stifling cash movement through mobile money platforms is huge.
This tax will evidently reduce the flow of money. People will hold money more or minimize how they frequently send money through mobile money platforms to pay for services like they use to do.

The serious outcry against this finance law is because mobile money is massively used by middle class, lower class, unbanked, SMEs (both formal and informal). This new tax will increase expenses for individuals and reduce profit margins for small businesses who already have thin profit margins because they are small businesses and depend heavily on mobile money platforms to receive payments and make financial transactions.

I do not think the real situation on the ground was taken into consideration when designing this finance law.

I totally agree with Rebecca Enonchong “The tax is regressive” when it concerns the promotion of innovation around FINTECH and will slow down financial inclusion, especially among people in rural and semi urban areas. Cameroon has just 11% bank penetration, meaning the majority of the citizens depend on these platforms to move money within the country. This move by the government will make the growth of digital businesses relying on platforms like these to be more difficult. As stated, it will stifle innovation around FINTECH and E-Commerce which will keep the country lagging behind in areas that are moving other economies forward.

Just few months back, BEAC in her recent report on the state of electronic payment in CEMAC region in 2020, the bank of Central African states lobbied for relaxed taxation to allow the development of the mobile money sector. According to BEAC, the main consequences of increase in taxes are the slowdown in financial inclusion.

The huge challenge with the tax, it is fixed on the capital not on the sending fee or withdrawal fee. I see this as a desperate move by the government. Taxes should be paid on a fee (commission) not on the capital amount being sent or withdrawn. I do not think citizens will be lamenting this much if the 0.2% was calculated on the fee collected by the telecommunication companies.

One truth raising the massive disapproval by the citizens regarding the new finance law, is the disappointment many people have with the government when it comes to using tax payers money for the right purposes. The truth is, if the tax money will go to good use, many will not oppose but in a situation where the general government has a track record of consistently being inefficient in executing public projects, corruption and embezzlement on the rise, service delivery to citizens not the best, people are fed up.

I also think the government directed their attention to the wrong area. Our government should have been thinking on new policies to institute that will lead to increase in our GDP as a way to increase tax revenue instead of increasing taxes on already existing systems like mobile money. I personally think this is just the beginning. Let us expect more increase in diverse areas. The government is stranded financially.

Excerpts of Javnyuy Joybert on BBC talking about the New Mobile Money Tax


If the government must institute the mobile money tax, then they should
1. Charge the 0.2% once either on withdrawal charges or sending charges only, not on the two and not on the capital amount being sent or withdrawn.
2. Reduce the tax to maximum 0.1% and still either on withdrawal charges or sending charges, not taxing both and not taxing the capital amount being sent or withdrawn.
3. Better still totally remove the 0.2% tax and focus seeking more ways to grow the economy, increase GDP and get more tax revenues. Moreover, the government should be intentional at achieving financial inclusion by leveraging on new financial models apart from conventional banks and microfinance institutions which have existed for years but not inclusive.
4. Have a more accountable system and efficient public project execution that will build the confidence of the citizens when it comes to the usage of tax payers money for the good of the nation
5. The government is adding mobile money tax because they need more money. The government is losing money through standard taxes informal businesses could be paying if they were moved to the formal sector where they can be held accountable to pay. Most informal businesses instead pay “so called” taxes to the private pockets of tax officials. The government through the ministry of SME should create more sustainable results driven programs to encourage informal businesses to become registered businesses so they could pay taxes. An ethical business should pay taxes.
6. The ministry of finance and taxation department should intentionally invest to curb corruption and embezzlement of tax payers money. The more the government is losing money to corruption, the more they seek more ways to create more taxes. Not all taxes collected by tax officers get into the government treasury. I know the government has taken actions to digitalize the payment of taxes, but this process should be complete and seamless both in urban, semi-urban and rural areas. That way the government will collect more money.

There is another angle to look at this, for now you have read my 2 cents. What do you think about this? If you had the opportunity to advise the head of state, what will you say.

Let’s drive this conversation intelligently. Reading your comments.


Javnyuy Joybert
Entrepreneur & Business Consultant
Douala, Cameroon

Email:  Whatsapp: +237674949153