Suspend 5 percent banking sector clean-up levy - Economist advises

Economist Emmanuel Amoah Darkwah has advised the government to suspend the implementation of the financial sector clean-up levy of 5% on profit-before-tax of banks.

He explains that the banking sector has suffered over the last three years due to the clean-up exercise.

Caretaker Finance Minister Osei Kyei-Mensah-Bonsu last week Friday told Parliament that the government will “introduce a financial sector clean-up levy of 5% on profit-before-tax of banks to help defray outstanding commitments in the sector”.

He said this was necessary because of the cost involved in cleaning up the sector.

”Although the financial sector clean-up and the refund of monies to depositors have restored investor confidence and protected the hard-earned savings of millions of Ghanaians, it came at “a huge cost of over GH¢21.0 billion to the government”.

The government is also asking Parliament to approve GHS5.5 billion for use in paying the remaining customers whose funds were locked up with various financial institutions as a result of the financial sector clean-up exercise.

Reacting to this, Mr. Amoah-Darkwah would burden the sector and make the financial inclusion agenda difficult to achieve.

On the issue of road tolls, he questioned the efficiency in the collection of tolls to warrant an increment.

”How many tolls are automated. We are collecting the tolls but the monies are going into individual pockets”.

He was not too happy about the increment in petroleum prices when already the prices were still going high.

He said per the structure of transportation in Ghana, increment in fuel prices affects every activity in Ghana.

Meanwhile, he says the idea of the Sanitation and Pollution Tax (Borl Tax) is not bad in itself but where we are getting it from should be paramount.