Impact of mobile money taxation on social sector financing in Sub-Saharan Africa

Mobile money is “a technology that allows people to transfer funds between banks or accounts, deposit or withdraw funds, or pay bills by using a mobile phone”(ben Romdhane et al., 2019). In recent years, mobile money has become the transaction of choice for people with limited access to traditional financial institutions due to necessity, resulting into its widespread use in emerging markets. Due to the sector’s rapid growth, size and future potential of the sector, mobile money has recently been seen as an attractive and easy way to increase tax revenues (Haidar, 2020). This paper looks at mobile money taxation across Sub-Saharan Africa (SSA). It analyses the experience of various countries in SSA where these taxes have already been introduced, looking at the revenue generation potential of these funding source and the implications for social sector financing. Moreover, it analyses the impact these taxes have on the vulnerable sections of the society. Finally, it discusses the likely implications of the introduction of mobile money taxation in Tanzania.