Ursula defends 'low' 1.75% E-levy rate with UK's 10%

Parliament to consider 'new' E-levy Bill

Minority vow to continue dogged opposition

Government defend levy as development gane-changer

Ursula Owusu-Ekuful, Communications and Digitalization Minister has mounted a defence for the current rate of 1.75% on all electronic transactions as contained in the E-levy Bill.

According to her, compared to

Read full articlea similar digital tax as is currently being implemented in the United Kingdom, UK, Ghana's rate was way lower given that the UK's rate was 10%.

While the Minority in Parliament has vowed to only 'support' a 0% rate, there have been suggestions by industry players and experts that government should consider lowering the rate.

Addressing a town-hall meeting at Koforidua on Thursday, January 27, 2022, Ursula enumerated a number of taxes that had previously been introduced by governments stressing their importance in development efforts.

“In 2008, the government of President Kufuor, introduced the Communications Service Tax in August of that year, and it became another source of income for national development. "That tax was introduced at a rate of 6%, which was later increased to 9%.

"E-levy is being introduced at the lowest rate for any tax in Ghana, comparatively at 1.75%. Less than 2%. In other countries, digital taxes are being introduced at the rate of up to 10% and they’re paying. That’s the UK."

She added: "...we go there (UK) and seek loans from them to finance our development. When we are not paying the requisite taxes that we should.”

At the same gathering, colleague ministers of Finance and Information Ministries also made presentations and answered questions about the importance of the E-levy. Also in attendance was Deputy Majority Leader Alexander Kwamina Afenyo-Markin.

The E-levy since its announcement by the Finance Minister in November 2021 has received public backlash from some Ghanaians especially Members of Parliament from the Minority Caucus.

At a recent press conference, the Minister announced a number of modifications to the Bill and said the government continued to engage stakeholders on the bill ahead of resubmission before MPs.

Background

On November 17, 2021, Finance Minister, Ken Ofori-Atta, announced the introduction of a 1.75% tax on all electronic transactions during the 2022 budget presentation before parliament.

According to him, this new directive forms part of strategies to widen the country’s tax net.

He added that the 1.75% tax is also to enhance financial inclusion and protect the vulnerable in the country.