E-levy is a nuisance tax, we join the millions of Ghanaians to reject it – Baskin Africa
Baskin Africa has described the E-levy (Electronic Transaction Levy) as a nuisance tax which will have dire consequences on businesses in the country.
Finance Minister, Ken Ofori Atta, while presenting the 2022 Budget statement on the floor of parliament on Wednesday, November 17, 2021 announced the introduction of a 1.75% tax on E-transactions effective January 1, 2022.
“After considerable deliberations, the government has decided to place a levy on all electronic transactions to widen the tax net and rope in the informal sector. This shall be known as the “Electronic Transaction Levy or E-Levy”, he stated.
This tax, according to the Minister, will cover all mobile money (MoMo) payments, bank transfers, merchant payments, and inward remittances above GH₵ 100 and will be borne by the sender.
But transactions that amount to GH₵ 100 or less in a day or approximately GH₵ 3,000 per month will not be affected by this levy.
Mr Ken Ofori-Atta said this forms part of government’s strategies to widen the country’s tax net and also to enhance financial inclusion and protect the vulnerable in society.
However, Baskin Africa says the E-levy is a nuisance tax which should be abolished. In a statement released on Thursday, November 18, 2021 and signed by its Executive Secretary, Issifu Seidu Kudus Gbeadese, the think-tank argues that the tax will have a heavy negative impact on electronic services like MoMo and e-zwich transactions in Ghana.
“Baskin again considers this e-transaction levy of 1.75% as a nuisance tax which will obviously have a heavy negative impact on e-services like mobile money transactions, e-zwich transactions”, part of the statement read.
Baskin has therefore called on the government to give incentives to businesses and individuals who promote electronic services rather than taxing them.
“The global economy is transitioning into a digital one, and so Ghana as an emerging economy should rather give incentives to businesses and individuals who promote digital transformation and electronic services and not to resort to taxing the very sector we want to grow”.
“Baskin Africa therefore suggest that government should find alternative ways of generating revenue rather than this easy way of taxing the overtaxed poor masses.”
“We join the millions of Ghanaians to outrightly reject this e-transaction levy”, the statement added.
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