Parliament passes E-levy bill

Minority demands shelving of E-Levy for further consultation
Parliament of Ghana

The Electronic Levy bill (E-levy) has been passed by parliament despite a walkout by the minority group in the House on Tuesday, March 29, 2022. By this, the levy becomes operational once President Nana Akufo-Addo assents to it as he prepares to deliver the State of the Nation address later today.

E-levy reduced to 1.5 percent

Finance Minister Ken Ofori-Atta, who was present in the House, announced a reduction in the levy to 1.5 percent from the initial 1.75 percent proposed by government. Providing some details for the reduction, Mr. Ofori-Atta said telcos in the country agreed to reduce their charges by .25 of a percentage point to bring their part of the charge to 0.75 percent.

He explained that the bill’s objective is to broaden the tax base of the country by imposing the levy on electronic transfers to enhance government’s drive for revenue mobilisation. He was optimistic that the levy, which is expected to raise about GH¢6.9billion in 2022, will serve as a key mechanism that ensures Ghanaians contribute their fair share toward development of the country.

E-levy in 2022 budget

The E-levy was introduced by government in the 2022 Budget for basic transactions related to digital payments and electronic platform transactions. The rate will apply to electronic transactions that are more than GH¢100 on a daily basis. Government has already clarified that the levy is different from the 1 percent telcos currently charge on transactions.

Opposers of e-levy

After it was announced in the 2022 Budget statement, the E-levy sparked controversy due to the perception that it will lead to double taxation—worsening the economic plight of Ghanaians. The bill’s opposers have lamented that it will hit hardest low-income earners who rely on daily mobile money transfers to survive.

Aside from the minority group, some Civil Society Organisations and auditing firms such as the PwC and KPMG have all appealed to government to provide better and further particulars on the remit of the levy.

The Minority Leader and Member of Parliament (MP) for Tamale South, Haruna Iddrisu, during parliamentary proceedings accused the Majority Caucus of smuggling the E-levy bill into the Order Paper for consideration.

Mr. Iddrisu contended that the E-levy bill was not enlisted in Parliament’s business statement for the week that was made available to MPs on Friday, March 25, 2022. Expressing his disappointment at the turn of event, the minority demanded reasons for the surprise pulled on the House by the Majority Caucus.

Mr. Iddrisu fumed, stressing that the minority will not condone the springing of surprises by the majority when considering important government policies which affect the livelihoods of ordinary Ghanaians.

“When you (Majority Caucus) did not have the numbers, you were hesitant; you wouldn’t come before the House. Now that you think that you have some reasonable numbers, then you say ‘go to the business of item 27’. We have warned time and again and cautioned that we do not want to be taken by surprise by a major economic policy of the government,” Mr. Iddrisu lamented.

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