Vice President Mahamudu Bawumia who is the chairman of Ghana’s Economic Management Team is yet to say a word about the E-Levy. This has left many asking: why is the person who is supposed to ensure that the economy is in good shape suddenly becomes silent when the economy is on the verge of collapse?
Many government officials including Finance Minister Ken Ofori-Atta and Parliamentary Affairs Minister Osei Kyei-Mensah-Bonsu have indicated that Ghana’s economy would collapse should the E-Levy Bill not be passed.
President Nana Addo Dankwa Akufo-Addo even recently said Ghana cannot continue to rely on borrowing for the development of the country but must start raising funds domestically and therefore the need for tax measures such as the E-Levy.
Noticeably at the New Patriotic Party's (NPP) Annual National Delegates Conference held on December 20, 2021, in Kumasi, Dr Bawumia said nothing about the E-levy when almost all the speakers talked about it and its seeming importance to the economy.
Why the silence over an issue that has become a matter of national concern and has even resulted in a fistfight in Ghana’s parliament? Could it be because of his previous position on taxing mobile money transactions?
Vice President Bawumia in an interview on Peace FM some years ago said: “it is unconscionable to tax mobile money (MoMo) transactions.” He then explained that MoMo is one of the surest mediums for poor people to transfer money and therefore should not be taxed.
Could Dr Bawumia's silence be a protest against claims by some government officials that Ghana’s economy would collapse without the E-Levy?
Dr Bawumia is an economist and has promoted the government’s economic policies over the past years. In fact, he is one of the top economists in the country and his ability to punch holes into the economic policies of the previous government played a role in the New Patriotic Party’s election victory.
With his economic expertise and the fact that he is the chairperson of Ghana’s economic management team, the vice president would be in the position to recognise when Ghana’s economy is collapsing and whether the E-Levy would be the 'saviour'.
Many economists including Dr Jibril Mohammed of the University of Professional Studies as well as Professor Lord Mensah and Professor Godfred Bokpin both of the University of Ghana Business School have said in the media that the E-Levy would not save Ghana’s economy as being purported by government officials.
Professor Lord argues on Joy FM that the government was so keen on implementing the E-Levy because it does not want to be restrictive in its spending. According to him, the government per the 2022 budget has already made provisions for key expenditure items namely interest payment (GH¢37.5 billion) and compensation to employees (GH¢35.6 billion). These two items, he said, cannot be tempered with, however, the government can reduce other components of the budget including the payment of goods and services and allocation to government agencies.
Dr Mohammed also reiterated on the same platform that there is no need for the E-Levy because given that the government has now reduced its total expenditure (GH¢115.6 billion) and revenue (GH¢100.5 billion), government could simply reduce some of its capital expenditures (including the purchase of new items).
Does the Vice President agree with these two economists or he supports going to the International Monetary Fund (IMF) as the best solution to resolve Ghana's economic challenge?
Economists including Dr Mark Assibey Yeboah, former New Patriotic Party member of parliament, have stated that Ghana is currently facing a serious economic challenge and revenue from the E-Levy cannot resolve this challenge. They argue that going to the IMF would give government the needed revenue as well as some discipline.
Is the silence of the Vice President his position on the E-Levy?
Author: Ishmael Batoma
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Vice President Mahamudu Bawumia