Prof. Godfred Bokpin, an economist, is disappointed that Parliament’s Majority Caucus passed the contentious electronic transfer levy bill.
Since its introduction in the 2022 budget, the e-levy has been a major source of contention in Parliament and even among the general public.
However, Parliament passed the e-levy bill on Tuesday without the participation of the Minority MPs, who had staged a walkout.
“There are more efficient, progressive, fairer, and equitable ways of generating more tax revenue by improving efficiency along with existing tax handles,” Prof Bokpin said in response to the news. The amount that this e-levy can raise is a fraction of what we could have gotten if the exemption bill had been passed in 2019.”
“During the 2019 State of the Nation Address, the President stated that the biggest threat to Ghana’s revenue base is an exemption, stating that Ghana lost GHS4.66 billion in 2018, and assuring us that the new bill is on its way to Parliament.” Nothing has been done in all these years. But consider how urgently we want to pass the e-levy. When you do that, you’re creating an imbalance in the economy that says the economy is set up to favor foreign capital formation over domestic capital formation, which is unfortunate.”
The levy, which has been reduced from 1.75 percent to 1.5 percent as of today, Tuesday, March 29, 2022, will be a tax on electronic transactions, including mobile money payments.
Electronic transactions totaling more than GH100 per day will be subject to the charge.
Critics of the proposal have warned that the new tax will harm the Fintech industry, as well as low-income people and those who are not part of the formal banking system.
Since its introduction in the 2022 budget, the levy has been a source of contention in Parliament.
Tensions reached a head in December 2021, when lawmakers clashed in Parliament.
The government, on the other hand, claims that the levy will broaden the tax base, resulting in an additional GH6.9 billion in revenue in 2022.
