According to him, although the tax measure is a short-term one, government badly needs it to sustain the economy from entering into crisis.
Speaking at a forum organised by Solidare Ghana, the Dean of the University of Ghana Law School said despite the E-Levy being ‘horrendous’ and ‘wicked’, Ghana’s current economic situation requires the tax measure to be passed.
“The first step is to pass the E-levy immediately and implement it effectively. To prevent the collapse of the economy and a return to the stronghold of the IMF, we have no choice but to pass it,” he said.
“As horrible and wicked as it is, it is the only way to save our economy from collapse in the short term,” Prof. Atubuga added.
The Dean further implored government to be sincere in admitting the true state of Ghana’s economy in order for citizens to join in efforts aimed at sustaining the country with key policies such as the E-Levy.
“The starting point for passing the E-levy is for government to stop lying to the citizenry, come clean and confess that they thought the job of managing the economy was simple, but now they know better, plead with the people of Ghana that we have limited options now,” he noted, adding that he is confirmed that “Ghanaians will support it if this is done right.”
Professor Atuguba cautioned that failure to pass the E-Levy would result in government placing more taxes on other areas of the economy which will cause more hardship on citizens.
“If we do not support the e-levy government will simply tax something else, such as fuel, leading to a hike in ‘trotro’ fares. Depending on the rate and patronage, we’ll rake in billions of revenue every year. We can no longer borrow on the international financial market except at horrendous rates.”
“We should however ask, for one thing, absolute transparency every step of the way in the way and manner this e-levy is used,” he concluded.
E-Levy impasse
Since the announcement of the E-Levy, government has insisted the tax measure is necessary to generate some GH¢6.9 billion in revenue for Ghana in 2022.
Although a decision to approve the E-Levy is yet to materialize in Parliament, the Minority caucus has vowed to kick against approving the E-Levy citing it will place more hardship on the ordinary citizen.
Also, a cross-section of the public has bemoaned the introduction of the tax measure.
The E-levy is a new tax measure introduced by government in the 2022 Budget on basic transactions related to digital payments and electronic transactions aimed at widening the tax net and increasing revenue.
The tax measure, if approved, would place a charge of 1.75 percent on all electronic transactions that are more than GH¢100 daily (24 hours).
This will cover mobile money payments, ATM withdrawals, inward remittances among others.
