Business News Mon, 6 Dec 2021

E-Levy: Revenue estimate of US$1.5 billion is certainly wrong – Bright Simons

Ken Ofori-Atta to address concerns of 2022 budget statement

Government proposes 1.75% levy on electronic transactions

Bright Simons believes revenue estimates of US1.5 billion is wrong

Vice President of IMANI Africa, Bright Simmons, has rejected government’s estimates of raking in US$1.5 billion as revenue from the implementation of the electronic transaction levy.

Finance Minister Ken Ofori-Atta when delivering the 2022 budget statement before parliament in November announced the introduction of the Electronic Transaction levy, which will be waived for transactions that amount to GH¢100 or less in a day or approximately GH¢3,000 per month.

The implementation of the proposed levy which comes with a 1.75% rate has been widely criticised by a section of the public and rejected by some lawmakers in parliament.

Reacting to the development in a write-up available to GhanaWeb, Bright Simmons explained that, “The absolute rate of 1.75% and the minimum daily cumulative transactional threshold of GH¢100 before the tax kicks in, as indicated in the budget, are by themselves meaningless concepts. The revenue estimate of US$1.15 billion is also almost certainly wrong.”

“Even without a detailed policy document, which the government characteristically refuses to provide, most analysts have pointed out that the US$1.15 billion seems to have been derived from a naïve application of the 1.75% tax rate to the portion of the total transactional value of Ghanaian electronic financial services – roughly US$130 billion – made up of transactions above US$17 in value,” he continued.

Bright Simons added that the proposed E-Levy must not be treated as a quick tax measure as he believes it can have a lasting impact on the digital economy and therefore requires more analysis and stakeholder engagement.

Read Bright Simons’ write up and analysis below:

Source: www.ghanaweb.com
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