Business

Minority demands shelving of E-Levy for further consultation before approving budget 

Parliament of Ghana

The Minority in Parliament has maintained their stance on their disapproval of the newly proposed 1.75 percent  Electronic Transaction Levy (E-Levy) introduced in the 2022 budget.

Minority Leader, Haruna Iddrisu in his concluding statement on the post-budget debate, stated that the E-levy  will “turn the country backwards,” by affecting small businesses and individuals.

“We want to stand united, collectively, that we are against introduction of e-levy on electronic payments and transactions, and we will not support this budget if that is not withdrawn for revision and further discussions with stakeholder.

MoMo tax will affect poor ordinary Ghanaians and therefore, it should be suspended and shelved”, the minority leader said.

He further accused government of being opportunistic by taxing mobile money transactions, simply because available data show that digital transactions in the country grew astronomically in 2020, compared to the previous year.

According to him, the sharp rise recorded last year is due to the Covid-19 pandemic which discouraged person-to-person dealings.

As a means of expanding the tax net, the  finance minister in the 2020 Budget, announced a 1.75 percent levy on all electronic transactions in the country, covering mobile money payments, bank transfers, merchant payments, and remittances.

Data from the Bank of Ghana confirmed growing trend in online sales.

The data showed that between February 2020 and February 2021 alone, Ghana saw an increase of over 120 percent in the value of digital transactions compared to 44 percent for the period February 2019 to February 2020.

The total value of transactions for 2020 was estimated to be over GH¢500 billion compared to GH¢257 billion in 2019 and GH¢78 billion in 2016 (just 5 years ago) while total mobile money subscribers and active mobile money users have grown,” the budget statement noted.

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