Government embarks on stakeholder engagement on E-Levy
E-Levy rate reduced to 1.5 percent
Leader of the Minority caucus in parliament, Haruna Iddrisu, has refuted claims made by Finance Minister, Ken Ofori-Atta that the Electronic Transaction Levy would not amount to double taxation.
This comes after the Minister speaking at a government town hall meeting in Wa on February 21 rallied citizens to accept the tax measure as it seeks to fill revenue gaps and increase development.
Reacting to the comments outside parliament on Tuesday, February 22, Minority leader, Haruna Iddrisu said tax measure in its current form will ordinarily lead to double taxation since the underlying income would have normally been taxed.
He added that the E-Levy was regressive and unfair to the Ghanaian taxpayer.
“If anyone who works in the public service earns a salary of let's say GH¢2,000 or GH¢4,100 before you receive your salary, the gross income would mean a deduction of tax including income tax and PAYE, so assuming I earn GH¢5,000 as income, the irrebuttable presumption is that a deduction will be placed on it”
“…So if I decide to send GH¢2,000 of that amount to relative and another GH¢2000 also to another relative on an electronic management system, that will attract an E-Levy of 1.75 percent and if this is not double taxation then what else is it?” the majority leader questioned.
He further asked citizens to dismiss the finance minister’s assertions that accepting the E-Levy will enable government to pay monies into the District Assemblies Common Fund.
“Ghanaians should dismiss him with utmost contempt as an insincere minister who is not upholding the values of the provisions of Article 252 of the 1992 constitution, which requires that five percent of total revenue is deducted to the District Assembly Common Fund," Haruna Iddrisu said.
“He is in arrears from 2018 to 2019, 2020 to 2021. He is in arrears of over ¢2,133,000,000 yet, he has been collecting revenues and just a dedicated five percent of that revenue, as is required of him by the 1992 constitution, he has not made it available," Haruna Iddrisu stated.
Since the announcement of the E-Levy, government has insisted the tax measure is necessary to generate some GH¢6.9 billion in revenue for Ghana in 2022.
Although a decision to approve the E-Levy is yet to materialize in Parliament, the Minority caucus has vowed to kick against approving the E-Levy citing it will place more hardship on the ordinary citizen.
Also, a cross-section of the public has bemoaned the introduction of the tax measure.
The E-levy is a new tax measure introduced by government in the 2022 Budget on basic transactions related to digital payments and electronic transactions aimed at widening the tax net and increasing revenue.
The tax measure, if approved, would place a charge of 1.75 percent on all electronic transactions that are more than GH¢100 daily (24 hours).
This will cover mobile money payments, ATM withdrawals, inward remittances among others.
Haruna Iddrisu, Minority Leader in Parliament