One of the commercial centers of Mogadishu, the Bakara market, saw a second day of protests on Monday over a new five percent tax on electronic payments from the vendors. The sales tax went into force on Sunday and mandates that retailers add the additional fee to all electronic transactions. The goal of this decision is to raise money for security and infrastructure in Somalia, a country that is struggling with insecurity, corruption, and poverty.
Tradespeople have fiercely opposed the tax’s adoption, claiming that high transportation tariffs for goods already put a strain on them. Dozens of vendors gathered to express their displeasure as numerous stores in the market shuttered in protes
“We are not against the tax, but we need a proper system and a halt to the money being illegally extorted from merchants before we can agree to the government’s instructions,” Suleyman Adan, a trader, told an international media.
As one of the world’s economically weak and most corrupt nations, Somalia, has wider problems with economic management and governance, which are reflected in the protests. Security threats to the country also come from Al-Shabaab, an organization associated with Al-Qaeda that has long caused instability in the area.
Mogadishu resident Fadumo Adan observed that although a few companies have started to abide by the tax, there is still a general feeling of unhappiness. She brought attention to the broad criticism within the business community by saying, “I’ve seen dozens of merchants marching to showcase their dissatisfaction,”
Mps in Somalia have also opposed the tax, raising concerns about its timing and execution strategy in a nation grappling with both security and economic development.
The government’s decision to use this tax to pay for necessities has sparked discussions about economic policy, justice, and the value of communication between the people and the government. The resolution of this tax dispute may have an impact on future economic policies and the dynamic between the government and the private sector in Somalia, as the country strives for stability and growth.