You don’t need e-levy, reduce corruption and wasteful expenditure – Ricketts-Hagan

Minority against E-levy

Report reveals Ghana losses about US$3 billion a year through corruption

Government introduces 1.75 percent e-levy

The former deputy minister of Finance and MP for Cape Coast South, Kweku Ricketts-Hagan, has said that should the government take serious steps in fighting corruption and cutting wasteful expenditures, it will not need the GHC6.9

Read full articlebillion that it is seeking to raise through Electronic Transfer Levy (e-levy).

According to him, slapping new taxes on Ghanaians is unjustifiable as the government continue to waste resources on expenditures that yield no results.

“It is very difficult to justify to Ghanaians why they should pay more taxes when they see and hear corruption every day in government but it is brushed under the carpet for lack of evidence. Wasteful expenditures in projects that have yielded very little results but keep re¬appearing in the budget year after year, in the last 5 years, for more money to be thrown at it.”

Speaking to GhanaWeb before the e-levy bill was laid in Parliament on December 16, he alleged that spending frivolously on private jets and hotels as well as planning to buy a new presidential jet, "when life is so hard for many Ghanaians cannot be supported by right-minded people, therefore, asking people to pay their fair share of taxes is a slap in their faces."

“Yes, Ghanaians want good hospitals that will take care of their clinical needs, they want good schools that will give quality education to their children, they want good roads and many more that any decent government should be able to provide for its citizens. When they are getting these things, they will be prepared to pay their fair share of taxes, for the government to get the needed revenue to continue providing them with all these services. But when they see their taxes going down the drain with nothing to show for it, they will resist paying more taxes.”

“So, what Ghanaians really have a problem with, is seeing their tax revenues being wasted in ways that in the end has nothing to show for it. Whether we are borrowing, which we have done astronomically or levying our people to suffocate them and deepening their hardship, the results have been the same- abysmal! Nothing to show for it.”

He said for the government to give the impression that without the e-levy they cannot execute their 2022 programs, means it is a fallacy and mare tactics to frighten citizens into submission.

The MP, however, insisted that the e-levy is not necessarily the solution for the massive unemployment that the country faces at the moment.

“E-levy is a regressive tax that has been proven in other jurisdictions to be a nuisance tax because it becomes counterproductive. Most Ghanaians, who were 'unbanked' in the traditional sense, now bank through mobile money wallets, [thus] e-levy will become a tax on saving, which is an anti-investment policy, at least in the domestic investment sense. How can a tax policy that is a disincentive to investment be used in a pretence of growing the economy and creating jobs?” he queried.

He further explained that the argument that e-levies mean less borrowing is a hallucination, stating that the desire for borrowing will continue despite the introduction of the e-levy.

“In fact in 2022, the government has indicated in the budget that it will borrow a total GHC26.8 billion, with GHC12.5 billion encompassing the external amount being borrowed and GHC 14.3 billion representing the domestic component. Therefore the e-levy is not a financing substitution for borrowing as they will like you to think. They will still borrow - old habits die hard! The e-levy is, therefore, an insensitive tax for a post-pandemic economy.”