Director of ISSER, Prof. Peter Quartey
Government announces imposition of 1.75 e-levy
Stakeholders call for a review of e-levy
Parliament rejects 2022 budget
Director of the Institute of Social, Statistical and Economic Research, Prof. Peter Quartey has said that the government should consider pegging the 1.75 levy between 0.5 and 0.75 percent.
According to him, “revenue generation is highly necessary for the country’s economy, but taxing electronic transactions is not an optimal way to go about it and we feel the 1.75 percent is huge.”
Prof. Quartey intimated that even though people may still patronize electronic transactions, most businesses, employment, etc. will be affected which would, in the long run, affect the cost of living.
Finance Minister, Ken Ofori-Atta announced the introduction of a 1.75 levy on all electronic transactions from January 1, 2022. This announcement has dominated various discourses in recent times, with some arguing that it will erode the gains made by the country in fostering the digital agenda.
During ISSER’s post-budget review, Prof. Quartey noted that if people are able to find substitutes from these electronic transactions, it will pose a challenge to government’s revenue mobilization and digitalization agenda.
He wants government to reduce the rate and review it subsequently to reduce the effects that it may have on the country’s financial sector.
“However in the long run, if people can substitute, then that becomes a problem, your ability to raise revenue will be challenged, it will have potential impact on financial inclusion, the cashless economy and the potential acceptance of the usage of the soon to be introduced e-cedi.”
Meanwhile, parliament on November 26, 2021, rejected the 2022 budget, citing the new taxes introduced as an exploitation of Ghanaians by the government.
It is, however, being speculated that government is considering a review of the budget.