Economists urge govt to drop E-Levy …but govt says opposition to E-Levy is propaganda

Some economists at a forum in Accra have told the government to abort the controversial Electronic Transactions Bill (E-Levy) idea and find a more pragmatic way of generating revenue. 

According to the economists, the E-Levy is a double tax on largely income and could ground government’s digitalisation agenda. 

The economists are Professor Godfred Charles Ackah of the Institute of Statistical, Social, and Economic Research (ISSER) of the University of Ghana, Professor Godfred Alufar Bokpin of the University of Ghana and Dr Yaw Kwakye of the Institute of Economic Affairs (IEA), Ghana. 

Under the auspices of the Economic Governance Platform and Advocates for Christ, the public forum brought together participants from a broad spectrum, including a Deputy Minister of Finance, Dr John Kumah, civil society organisations, academia and students. 

Held in Accra yesterday, it was on the theme “E-Levy, IMF or What? : Sustainable Solution to Ghana’s Debt Crisis.” 

In his presentation on the topic “E-Levy: Not the Way to Salvation” Professor Ackah described the proposed levy as unfair, discriminatory and targets only one source of payment. 

“That is not a fair tax to be introduced. If at all, it should be broad based and target other forms of payment,” Professor Ackah stated.

He wondered how Ghana got to a point where if she was unable to raise GH¢6.9 billion to support the budget, the economy would crush. 

Noting that the government genuinely needed money to run affairs of the state, he said government must look at some untaxed areas like property tax and seal the loopholes and “forget about the E-Levy.”

To Dr Yaw Kwakye, the narrative by government and its assigns as though the E-Levy was the solution to all of Ghana’s problems was deceptive. 

“Before E-Levy, we were constructing roads so why are they telling us that without E-Levy, we can’t build roads. 

Currently, Ghana is able to collect only 12 per cent of tax to GDP annually. According to Dr Kwakye,if the loopholes are blocked, Ghana could collect as much as 24 per cent of GDP on taxes annually. 

Professor Bokpin on his part said going to the International Monetary Fund, though not sustainable, indications were that the government might take that step to instill discipline in its spending, and to give investors some confidence in the Ghanaian economy. 

Responding to the concerns of the economists, Dr John Kumah described the opposition to the levy as “propaganda.”

Dismissing claims that the E-Levy was a double tax, the Ejisu MP called for national support for the tax handle. 

The government, he said, did not take it lightly to introduce the levy in the 2022 Budget Statement and Economic Policy but had to do so because “the country is in extraordinary difficult times.”

BY JULIUS YAO PETETSI



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