Anybody who can transfer GHC3,000 per month is not poor – Prof Adei on E-Levy

Parliament approves E-Levy

Levy imposes 1.5% rate on digital transactions

Government hopes to raise GHC6.9bn annually from Levy

Economist and former rector of the Ghana Institute of Management and Public Administration, Prof. Stephen Adei, has restated his belief that the approval of the Electronic Transfer Levy (E-Levy) was a necessity in raising revenue.

According to him, paying

Read full articlethe levy was just a matter of time, because government needed to tax electronic transactions seeing that in his words, ‘it’s a low hanging fruit.’

In an interview with Accra100.5FM’s morning show last week, he also waded into the issue of who can be classified a poor person.

He stressed that the tax in its current state did not adversely affect the poor because of the exemption regime especially relative to mobile money transactions.

In his view, with an average pay of GHC1,500 cedis, anyone with capacity to transfer GHC3,000 in a month could not be classed as ‘poor.’

“For the poor, even if you transfer GHS100 thirty times, you will not pay e-levy… anybody who is able to transfer GHS3,000 in a month is not poor in Ghana because the average graduate pay is GHS1,500.”

“So, the e-levy will not affect a lot of people,” he added.



About the E-Levy

The government of Ghana will from May 1 charge a 1.5% rate on electronic transactions that are more than GH¢100 on a daily basis.

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

The E-Levy has been the source of tension in Parliament since it was introduced in the 2022 budget. The tensions culminated in a scuffle between lawmakers in Parliament in December 2021.

The government has, however, argued the levy would widen the tax net and could increase revenue generation by estimated GH¢6.9 billion in 2022. There are also concerns that the government may securitise proceeds from the e-levy to raise extra revenue.