Accra, Jan 20, GNA – The Minister of Finance, Ken Ofori-Atta, says the Electronic-levy component of the 2022 Budget will be re-submitted to Parliament for approval in January.
This follows extensive consultation with stakeholders and the agreement reached with telelcommunication operators to reduce Mobile Money charges by 0.25 per cent so as to reduce the overall net impact of the levy on subscribers.
“We look forward to joining hands with our honourable Members of Parliament to approve the E-Levy on a consensus basis so we can collectively address the big issue of unemployment, debt sustainability and infrasteucture build up,” he said at a media briefing in Accra, on Wednesday.
The reduction of charges which was agreed upon in the ” true spirit of burden-sharing”, he said, was a key measure to raising resources to improve fiscal position, “while keeping an eye on transaction costs and consumer welfare, and reducing the impact on the average Ghanaian and keeping the resources required for our growth agenda”.
To further deepen consultation, he announced that the Ministry, in partnership with Ministry of Information and other government agencies, would embark on extensive public engagement to educate Ghanaians on the essence of the E-levy.
He emphasised that the levy would not impact cumulative transfers of GHS 100 per day; transfers between accounts owned by the same person; transfers for the payment of taxes, fees, and charges on the Ghana.gov platform; and electronic clearing of cheques.
The levy would also not affect specified merchant payments, thus payments to commercial establishments registered with the Ghana Revenue Authority for Income Tax and VAT purposes and Transfers between principal, master-agent and agent’s accounts.
“Let me warn, though, that if there is realisation that certain migrations to avoid paying, we shall invoke the appropriate administrative measures,” he said.
The E- Levy, he said, was a necessary tool to increase our Tax to Gross Domestic Product (GDP) from 13 per cent to 16 per cent.
GDP is explained as the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period.
As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country’s economic health.
The Government in the 2022 Budget Statement and Fiscal Policy presented to Parliament, proposed an electronic transaction levy of 1.75 per cent.
The proposal has been met with mixed reaction, with critics saying it is too harsh for citizens dealing with a post-Covid economy, therefore, the Government should find more innovative ways to widen the tax net.
Those in support, however, argue that it is the best option given the urgency, with which given government requires funds to recover the economy from the impact of the COVID-19 pandemic.
Members of Parliament have been sharply divided on the approval of the levy, with controversial voting on its alleged rejection by the Minority side and subsequent alleged approval by the Majority side.
The Government is projecting to realise about ¢6.9 billion from the proposed tax on electronic transactions by end of 2022.
GNA