Ghana’s new E-levy since its May 1st introduction has continued to generate varying reactions across different sectors of the Ghanaian economy
The emerging e-commerce sector has registered its displeasure over the introduction of the e-levy on electronic transactions.
The last is yet to be heard about the controversial e-levy introduced in Ghana a few days ago. Rather than absolute rejection has displayed in recent days, the government has received a pat on the back for introducing the new tax that affects majorly the Mobile Money industry.
The pat on the back is coming from members of the Mobile Money Agents Association of Ghana, MMAG. This support according to the group is to cheer the government for deeming it fit to introduce what they tagged ‘a necessary tax on all electronic transfers.
During the recent meeting held with President Nana Addo Dankwa Akufo-Addo at the Jubilee House, the group took out the time to commend the government for the bold step towards implementing the tax because the current government reviewed the newly introduced tax from what it used to be before it was scrapped.
Recall that the 1.5% tax was initially put at 1.75% before its final review coupled with the fact that the government further introduced a list of exemptions to cushion the e-levy’s effect.
Calling for the compliance of citizens, the group through one of its members, Evans Otumfuor admits that drastic time calls for drastic measures as the e-levy will help the government stay aloft at a time when the country is experiencing hardship.
The group not playing shy of the current difficulty the new tax has brought appealed to the president to take deliberate steps in addressing challenges affecting their operations.
Some of the challenges identified include; financial fraud, armed robbery, high cost of operations, and difficulties in accessing funds. To solve some of these challenges, the association implored the President to include its members on boards and institutions whose policies and programs directly or indirectly affect their businesses.
e-Commerce Operator Side of the Story
e-commerce operator under the aegis of the E-Commerce Association of Ghana (eCAG) has joined critics to condemn the introduction of the e-levy as it affects them the more, depleting profits from e-commerce activities.
Following a recent submission by the association, the e-levy has in no small measure frustrated the government’s ease-of-doing-business agenda intending to make Ghana attractive to foreign and local investors as businesses are now thinking of relocating their businesses to other West African counterparts.
The reservations of the association are captured in a recent submission by its Executive Director, Paul Asinor who drew the government’s attention to the need to tread with caution when it comes to increasing taxes.
Taxmobile.Online captures its viral statement below,
“We do not want an instance where the government will keep increasing the E-levy and see it as an easy way to increase revenue.
We want to stop it now in the budget because it will affect our business. If the cost of doing business continues to increase, businesses will gradually reduce their investment and look outside where operations are less costly.”
In summary, the association wants the government to carry it along when the need arises to implement such a tax as this.
What MMAG is Saying
“Your Excellency, let it be on record that our organization believes in the payment of taxes as a major tool to drive the needed development and progress and would not do anything that frustrates the success of the E-levy,” the General Secretary stated.
“Your Excellency, recently we have witnessed the government’s plan to introduce an electronic transaction levy which, as an association, we have raised a number of concerns but as we speak now, yesterday we were in a meeting with the Ministry of Finance, Ghana Revenue Authority and other relevant stakeholders and most of our concerns regarding the electronic transfer levy (E-levy) have been addressed,” he stated.
“Your Excellency, we appeal to you and the Minister of Finance to expedite action to look at the challenges that the levy has brought to us as agents in line with doing our business such as deductions that are made at the agent’s account in an attempt to push funds from their agent’s accounts to their bank accounts for purposes of withdrawals and other agents’ related activities.”
“We have identified, Your Excellency, the feedback and signals picked after the implementation of the E-levy which has revealed that communication on the E-levy has been extremely low. Your Excellency, it is in the best interest of the association to help drive education and the needed sensitization. We are ready to mount any responsibility that government will be willing to give to the association to ensure that, one, our businesses are well protected and then again we will encourage the consumer to increase their confidence in the usage of the Mobile Money platform.”
More Gains for the Government
Just a few weeks into its implementation, the Ghanaian government is already declaring huge gains from the levy on each electronic transaction.
The above conclusion is reached as the Ghana Revenue Authority declared that collections from a single charging entity amounted to more than one million cedis in one day.
About the E-Levy
The e-levy introduced by the Ghana Revenue Authority on May 1st after the E-levy Bill was passed by Parliament and subsequently assented to by President Akufo-Addo, is a 1.5% tax on all electronic transfers.
The levy applies to mobile money transfers done between accounts on the same electronic money issuer and mobile money transfers from an account on one electronic money issuer to a recipient on another electronic money issuer.
Its scope also involves transfers from bank accounts to mobile money accounts and transfers from mobile money accounts to bank accounts
