1.75% tax has been put on electronic transaction
This is to widen the country’s tax net
But Sam George believes the newly introduced tax will impoverish the poor
The Member of Parliament for Ningo-Prampram, Sam Nartey George, has accused government of impoverishing the poor by introducing a 1.75% tax on all electronic transactions.
According to him, the e-levy rather relieves the rich because they have the means to pay the capped amount.
Speaking to GhanaWeb’s business desk post the budget reading, Sam George explained that the poor are now taking advantage of mobile money after understanding how it works, therefore, the newly introduced tax is unnecessary.
“The budget reading was one of shock, one of disappointment to realize that government is introducing an electronic levy. They are giving a tax relief to the rich, and taxing heavily the most impoverished persons in Ghana. The poorest people in this country, the lowest on the economic ladder are taking advantage of mobile money to be able to get financial inclusion. This budget single-handedly erodes 2 decades of gains that we have done in building digital inclusion in our country,” he said.
Describing the Mobile Money sector as the fastest growing one, the MP for Ningo-Prampram said the sector made rapid gains since its introduction 12 years ago.
This, he said, shows how easy it is to use MoMo, an alternative to traditional transactions.
“Mobile money has been in operation since 2009…In 2019, mobile money transactions were worth 370 billion cedis. By 2020, they were worth 517 billion. That tells you how fast they are growing,” Sam George stated.
However, the Communication and Digitalization Minister, Ursula Owusu-Ekuful, has justified government’s introduction of the e-levy.
She stated that anyone who sends GH¢100 or more is not poor.
“We have made it a part of this policy that up to a GH¢100 a day per a person is exempt. This, the state is saying, if you’re sending up to a GH¢100 a day, cumulatively, you can send up to GH¢3000 a month, that is all going to be tax-free. Now, if you have more than a GH¢100 to send a day, then you’re not poor. So, if you really are poor and you are in a position to send GH¢100 a day, then we need to re-classify the definition of who the real beneficiaries of these are, and it is only the sender who pays, not the receiver,” she clarified on GHOne TV.
Her comments have however generated controversies.
On November 17, 2021, Finance Minister, Ken Ofori-Atta, during the 2022 budget reading in parliament, announced the introduction of 1.75% tax on all electronic transactions.
According to him, this new directive forms part of strategies to widen the country’s tax net.
He added that, the 1.75% tax is also to enhance financial inclusion and protect the vulnerable in the country.
However, the Communication and Digitalization Minister, Ursula Owusu-Ekuful, has justified why government has introduced the e-levy.
She stated that anyone who sends GH¢100 or more is not poor.
“We have made it a part of this policy that up to a GH¢100 a day per a person is exempt. This, the state is saying, if you’re sending up to a GH¢100 a day, cumulatively, you can send up to GH¢3000 a month, that is all going to be tax-free. Now, if you have more than a GH¢100 to send a day, then you’re not poor. So, if you really are poor and you are in a position to send GH¢100 a day, then we need to re-classify the definition of who the real beneficiaries of these are, and it is only the sender who pays, not the receiver,” she clarified on GHOne TV.
Her comments have however generated controversies.
On November 17, 2021, Finance Minister, Ken Ofori-Atta, during the 2022 budget reading in parliament announced the introduction of 1.75% tax on all electronic transactions.
According to him, this new directive forms part of strategies to widen the country’s tax net.
He added that, the 1.75% tax is also to enhance financial inclusion and protect the vulnerable in the country.