Opoku Boateng: Government must engage Minority to reduce E-Levy rate

Dr Ernest Opoku Boateng, executive director of the African Public Research Centre(APRC) wants the government to consider a downward review of the Electronic Transfer Levy (E-Levy) from the current rate of 1.5%.

Opoku Boateng’s call comes ahead of today’s presentation of the 2022 Mid-Year Budget Review by the Finance Minister, Ken Ofori-Atta.

Speaking to Kwaku Nhyira-Addo on the Asaase Breakfast Show on Monday( 25 July) Opoku Boateng said engaging the Minority and civil society groups ahead of a possible review is crucial.

“… this for me is an opportunity for the government to engage the opposition in that initially they were amenable to reducing the rate as it were.”

“And so this will be a good opportunity to engage them further to see if there is a way to lower the rate and at the same time expand it to other areas. So there has to be a tweak and that can be done if there is an open engagement with CSO and minority,” he said.

The government prior to the passage of the E-Levy into law reduced the rate from 1.75% to 1.5% of the value of the transaction.

Government won’t terminate E-Levy

Meanwhile, the government has said it will not terminate the Electronic Transfer levy [E-Levy] because of its decision to engage the International Monetary Fund (IMF) for a bailout.

According to the Finance Ministry, the proceeds from the E-Levy will help to shore up the country’s economic fortunes amid the IMF support.

Answering the question of whether the E-Levy will be terminated, the Finance Ministry in a Frequently Asked Questions (FAQs) said, “No. The IMF lending to Ghana will be for balance of payments support (i.e. to shore up the international reserves).

“Government is committed to ensuring the smooth operationalisation of all taxes including the e-levy to ensure that in addition to the IMF’s resources, government can continue to support its developmental goals on its own while ensuring that tax-to-GPD ratio increases to the peer range of 16%-18%.

“An IMF-supported programme is likely to encourage the government to investigate the factors hindering the success of the E-Levy (including by providing technical assistance if needed) and come out with strategies to improve it. Additionally, other tax measures could be considered for the medium-term.”

Fred Dzakpata