Minority members in Parliament
Minister for Finance, Ken Ofori-Atta has indicated that the government will continue consultations with the Minority side in Parliament and other relevant stakeholders to get the approval of the proposed Electronic Transaction Levy, commonly called E-levy.
He explained the that there was the need for consensus on the E-levy, considering it important on the country’s current economic and fiscal policy.
Ken Ofori-Atta speaking at the news conference held Monday December 6, 2021 noted that “On the matter of the E-levy, having regard to its serious fiscal implications, we will continue our consultations with the Minority Caucus in Parliament and other relevant stakeholders, with a view to achieving consensus and reverting to the House in the shortest possible time.
“Having regard to its serious fiscal implications, we will continue our consultation with the minority caucus in parliament and other relevant stakeholders with the view to achieving consensus and reverting to the house in the shortest possible time.”
Giving one of the reasons for the E-levy, the Minister mentioned that the tax to GDP ratio in Ghana is one of the lowest on the continent hence there is a need to improve upon it to bring it to par with the average ratio on the continent.
He emphasised that the e-levy is the country’s best bet to increase its tax base and help to meet the average tax to GDP ratio on the continent.
“E-levy represents our greatest opportunity to in the medium term broaden the tax base and meet the tax to GDP ratio of 20% as pertains to our peers.”
While highlighting plans by the government to ensure that the e-levy helps the government to respond to the needs of citizens, Ken Ofori-Atta said efforts would be made to ensure that no one evades the levy.
“We shall also ensure that measures will be taken to avoid attempts at evading the e-levy taxes. The proposed e-levy tax is largely progressive, and we have intentionally set the GHS 100 threshold covering about 40% of MoMo users, mindful of the need to exempt vulnerable groups while continuing to encourage the development of our nascent digital economy,” according Ken Ofori-Atta.
The 1.75% tax on all digital financial transactions; E-levy, is one of the main proposals of the government in the 2022 budget presented to parliament by the Finance Minister, Ken Ofori-Atta November 17, 2021.
The tax has since been met with mixed reactions, with Ghanaians kicking against it and stressing that it will only place an extra burden on their finances.
The minority in parliament has announced that it will not support approval for the proposal albeit the Minority Leader proposal to have it reduced to 1 percent.
By Vincent Kubi