No need to keep E-Levy if projections are not met – Tax analyst

E-Levy can be likened to a nuisance tax, Tax analyst

E-Levy not generating projected revenue, Gabby Otchere-Darko

E-levy is a failed tax measure, Sam Nartey George

A tax expert Timore Boi has stated that the Electronic Transfer Levy may be withdrawn due to its unpopularity and inability to generate revenue as projected by the government.

According to him, if things continue the way they currently are, the E-Levy will become a nuisance tax.

“If things don’t change, I think that the E-Levy is going to be classified as a nuisance tax. And when we say nuisance tax, we mean a tax paid in small but frequent amounts, usually by consumers.

"...So, if we are anticipating that it will bring us GH¢4.2 billion but at the end of the day we are just about collecting less than GH¢300 million then there is no need to keep it, you would have to withdraw it because it doesn’t achieve its purpose.”

According to the tax expert, government will have no choice but to withdraw the tax if revenues remain low.

“Aside from the nuisance you are causing consumers, you are better off withdrawing it so you earn their sympathy. If we are unable to increase performance to about 60% or 70%, I think that E-Levy stands a chance of being withdrawn,” he added.

His comments come after stakeholders revealed that the E-Levy is not generating the projected revenue as expected.

A leading member of the New Patriotic Party (NPP) Gabby Asare Otchere-Darko revealed only 10% of the projected revenue has been achieved so far, after 2 months of the tax’s implementation.

However, MP for Ningo-Prampram, Sam Nartey George. has noted that the E-Levy is a failed tax measure.

He said the introduction of the E-Levy has reduced the usage of electronic transactions especially, mobile money.

“Last week, the Economic Management Team met with key stakeholders in the implementation of the E-Levy and it is evident that our nation is in crisis. The golden egg we were promised has turned out to be ‘alumi’,” he said.

He added that “Transaction volumes have reduced by about 18% month-on-month and transaction values have declined by about 40%. This is what we warned the government about but our government is tone-deaf”.

SSD/MA