Mobile network operator MTN Uganda plans to increase its mobile money rates effective immediately.

According to the telco, its decision to increase tariffs follows changes to the 2013/2014 national budget with regard to tax on money transfer services.

The new mobile money rates will have a slight increase on transaction fees. For example sending $1, 551 to another registered subscriber will now cost $0.85, says MTN Uganda.

MTN Uganda’s general manager for corporate services Anthony Katamba said, “The 10% levy on mobile money is to be applied on transaction fees paid on all money transfer services and as such the fee is paid by users. It should be noted that the new 10% levy is to be applied on all money transfer services offered in Uganda, including those offered by non-telecom operators”.

“Although we feel the tax has been applied at a very early development stage of the mobile money product, MTN is committed to continued investment and growth of the service in Uganda,” Katamba added.

MTN Uganda’s Mobile Money active customer base has recorded growth by more than 50% during the last 12 months, according to the mobile operator.