ISSER proposes E-levy of 0.5%

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Director of the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana, Professor Peter Quartey has proposed E-levy of 0.5 per cent.

This is below the 1.75 per cent levy introduced in the government’s budget statement for the 2022 fiscal year.

Speaking interview with TV3 on Monday November 29, Prof Quartey noted that the budget is very ambitious.

He said “Within a year you are going to increase your revenue by over 42 per cent, it is very ambitious in my view.

“I don’t think the alone would make up for that. Same with the fiscal consolidation, we may achieve something but I don’t think we might hit the 7.4 per cent. Even that, already people are agitating  and speaking against the e-levy and some of the levies  proposed.

Regarding the E-levy proposal, he recommended “a levy of 0.5 and 0.75.”

The levy has been rejected by some Ghanaians. For instance, the Minority Leader Haruna Iddrisu said the E-levy policy proposal in the 2022 budget statement is a disincentive to the growth of digital economy.

To that end, he said, the Minority would not support it.

Speaking at a post budget workshop in Ho on Saturday November 20, he said “Mr Speaker, understandably, we see that the Minister of Finance seeks to introduce some measures including the now popularly declared e-levy or digital levy as some have quite named it.

“Mr Speaker, our concern is whether the e-levy itself is not and will not be a disincentive to the growth of digital economy in our country. We are convinced that the e-levy may as well even be a disincentive to investment and a disincentive to private sector development in our country. We in the minority may not and will not support government with the introduction of that particular e-levy. We are unable to build national consensus on that particular matter.”

Finance Minister Ken Ofori Atta announced a new levy to be charged by government in 2022 on all electronic transactions to widen the tax net and rope in the informal sector.

“It is becoming clear there exists enormous potential to increase tax revenues by bringing into the tax bracket, transactions that could be best defined as being undertaken in the ‘informal economy’,” Mr Ofori-Atta observed on Wednesday, November 17 as he presented the 2022 budget statement in Parliament.

“After considerable deliberations, government has decided to place a levy on all electronic transactions to widen the tax net and rope in the informal sector. This shall be known as the ‘Electronic Transaction Levy or E-Levy’.”

He explained that the new E-levy will be a 1.75 per cent charge on all electronic transactions covering mobile money payments, bank transfers, merchant payments and inward remittances to be borne by the sender except inward remittances, which will be borne by the recipient.

This will, however, not affect transactions that add up to GH¢100 per less per day.

Source: myghanadaily

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