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E-levy should be split for consumers, telcos to pay – Economist

An economist with the Institute of Economic Affairs, IEA, is proposing a split in the rate of the electronic transfer levy to be shared among Telcos and consumers.

Senior Economist at the IEA, Dr John Kwakye, is of the view that out of the proposed 1.5 percent levy, the Telcos should be charged 0.75 percent while consumers pay 0.75 percent.

“Add 0.75 percent to the telcos’ charges and let the consumers bear 0.75 percent. Maybe that will be a better compromise,” he said to Citi News.

“I don’t know whether the Minority would be willing to accept this because you should let the telcos who are enjoying windfall profits also pay costs. Putting it all on consumers, I don’t think that is the best way to go,” Dr. Kwakye added.

The e-levy is yet to be re-considered in Parliament after contentions towards the end of the last Parliament.

The Minority in Parliament has remained steadfast in its opposition to the passage of the e-ley bill.

The e-levy is a new tax measure introduced by the government in the 2022 Budget on basic transactions related to digital payments and electronic platform transactions.

The levy will apply to electronic transactions that are more than GH¢100 on a daily basis.

Critics of the proposal have warned that this new levy will negatively impact the Fintech space, as well as hurt low-income people and those outside the formal banking sector.

The government has, however, argued the levy would widen the tax net and that could raise an extra GH¢6.9 billion in 2022.

Citi news

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