Introduction of e-levy will negatively impact us – eCommerce Association of Ghana

The eCommerce Association of Ghana has said the government’s recent introduction of an e-levy on all e-transactions will have a negative impact on e-commerce sector in the country.

Once the 2022 budget is approved, all electronic transactions in Ghana will attract an e-Levy, as part of moves by the government to shore up its revenue mobilisation.

This was announced by Finance Minister, Ken Ofori-Atta on Wednesday, November 17, 2022 when he presented the 2022 budget to parliament.

He explained that the upsurge in the use of e-payment platforms as a result of the COVID-19 pandemic has been an impetus for the introduction of the levy.

As a result, Ghana recorded a total of GHS500 billion from e-transactions in 2020 compared with GHS78 billion in 2016.

He said: “It is becoming clear there exists an enormous potential to increase tax revenues by bringing into the tax bracket, transactions that could be best defined as being undertaken in the informal economy.”

He noted, therefore, that the government is charging an applicable rate of 1.75% on all electronic transactions covering mobile money payments, bank transfers, merchant payments and inward remittances, which shall be borne by the sender except inward remittances, which will be borne by the recipient.

“Mr Speaker, to safeguard efforts being made to enhance financial inclusion and protect the vulnerable, all transactions that add up to GHS100 or less per day, which is approximately GHS3,000 per month, will be exempt from this levy,” he stated.

He said E-Levy proceeds will be used to support entrepreneurship, youth employment, cyber security, and digital and road infrastructure, among others.

“Mr Speaker, this new policy also comes into effect once appropriation is passed from 1st January 2022. The government will work with all industry partners to ensure that their systems and payment platforms are configured to implement the policy,” he said.

Reacting to the e-levy, however, the eCommerce Association of Ghana said in a statement signed by Executive Director Paul Asinor, dated Thursday, 18 November 2021 that it has the “potential of eroding all the gains made by the government’s digitalisation agenda” and could spark a “major U-turn to the government’s vision of a cash-lite economy”.

Additionally, the group said it could send the largely unbanked population back to the days of financial exclusion, have a negative toll on the use of digital payments as compared to the ‘cash is king’ era, slow down the development of e-commerce in Ghana, as most payments are made through mobile wallets and fintech platforms today and reduce online sales resulting in tax reduction to the government

Read the full statement below:

THE INTRODUCTION OF E-LEVY ON ELECTRONIC TRANSACTIONS – THE VIEW OF THE ECOMMERCE ASSOCIATION OF GHANA

The attention of the eCommerce Association of Ghana has been drawn to the introduction of the new E-Levy on electronic transactions in yesterday’s Financial Policy of the Government for 2022, read by the Honorable Minister of Finance, Ken Ofori Atta.

Inasmuch as we, as the industry association of Ghana's online retail, are not against the need for government to find creative ways of generating revenue to administer their mandate, we wish to draw to their attention, some of the negative impacts that this new e-levy is going to wield on the e-commerce and other affiliated industries in Ghana:



1. Potential of eroding all the gains made by the government’s digitalisation agenda and a major U-turn to the government’s vision of a cash-lite economy.

2. Sending the largely unbanked population back to the days of financial exclusion.

3. A negative toll on the use of digital payments as compared to the “cash is king” era.

4. Slow down on the development of e-commerce in Ghana as most payments are made through mobile wallets and fintech platforms today.

5. Reduction in online sales resulting in tax reduction to the government.

6. Return to increased cash transactions, compromising the safety of delivery riders, etc.

7. Loss of jobs in the eCommerce and fintech industries, etc

We, therefore, seek, as a matter of urgency, to engage with the Ministry of Finance and all other relevant stakeholders to discuss this e-levy, its impact on online businesses and jobs, have another look, and possibly reduce or even suspend it.

Furthermore, we would like to assure members of our association and the entire eCommerce community in Ghana that we will continue to promote and grow online retail and boost confidence in the sector.

We understand that after COVID-19, your focus is business recovery and we seek to remove all administrative burdens that may impact adversely on that.

Thank you.

Paul Asinor

Executive Director

eCommerce Association of Ghana