E-levy Will Close Revenue Gaps – Deputy Finance Minister
The government has decided to place a levy on all electronic transactions to widen the tax net and rope in the informal sector.
Ken Ofori-Atta, the Minister of Finance, announced a 1.75 percent E-levy on mobile money and all electronic transactions in the country on Wednesday (17 November) as a measure to “rope in the informal sector into the tax net.”
Since then, several analysts have warned that the new fee is “regressive” and may jeopardize the government’s efforts to increase financial inclusion.
However, the Deputy Minister for Finance, Abena Osei Asare in an interview with an Accra-based FM station has disagreed.
According to her, the introduction of E-levy in the 2022 Budget will help plug revenue loopholes in the country.
“In every country, citizens pay taxes but what you do is that you make the taxes progressive such that those who earn more feel the burden of the tax more than those who earn less. That is why in this electronic transaction levy that we are coming out with, those who do a GHC100 cumulatively every day are exempted from paying this levy”.
She went further to say, that, “We did a study and realised that over close to 42% of people who do MoMo (mobile money) transactions everyday between GHC 1 and GHC 100 are about 42%, so clearly the government is thinking about those people and saying that for those people they are exempted from the E-levy.
“But for those of us who do more than GHC100 every day, it’s a progressive tax. It is for the good of this nation that we all raise the necessary taxes and be able to fund the government’s flagship programmes,” she added.
Madam Asare said the introduction of the E-levy is strategic.
“Many times people talk about raising tax revenues, how do you formalise the economy and we have realised a niche in electronic transactions. According to UNECA, the digital economy has grown from 11.5 trillion in 2016 and is going to 23 trillion; we also want to take advantage of it”, she said.