Users of Whatsapp, Facebook, Skype and other social media in Uganda will have to pay a daily tax from July, according to a new law that rights activists have criticised as a bid to stifle free speech.

Uganda’s parliament passed a law late on Wednesday imposing a tax of 200 shillings (five cents) a day on users of so-called “over-the-top” services which publish content bypassing traditional distributors. The new law did not spell out how the tax would be applied and collected.

Finance minister David Bahati said the aim of the legislation was only to raise revenue for public services. However, the president, Yoweri Museveni, wrote to the finance ministry in March urging the introduction of the tax as a way to deal with the consequences of online “gossip”.

Journalist and activist Lydia Namubiru said Museveni saw online communication as a threat to his 32-year rule. “The president ... said it was to stop young people from gossiping but what’s ironic about that statement is that it comes after [popular musician] Bobi Wine became a member of parliament through an online campaign,” Namubiru said, referring to an opposition politician who has proved wildly popular with Uganda’s frustrated youth.

“It’s actually political speech and online organising which has real-life implications for him and his power. The overarching intention is to stifle free speech, especially now there is evidence that online organisation works.”

Despite the small daily levy, Namubiru said he thought it would be effective in curtailing social media use, because most Ugandans buy data in small bundles of 500-1,000 shillings.

During the 2016 presidential elections access to social media was shut down, and in April, Uganda’s communications regulator instructed internet service providers to suspend unlicensed online news websites.

The new law also includes a new tax of one percent on mobile money transactions. With little access to formal banking services, many Ugandans rely on mobile telephone companies to store and transfer money electronically.

“Only 5 million Ugandans countrywide can access the banking sector leaving the rest to mobile money services,” said Winnie Kiiza, the opposition leader in parliament as she opposed the move. The country has a population of more than 40 million.