E-levy introduction was obvious – Digital think thank

Derek Laryea, Director for the Africa Digital Economic Forum, believes the tax levies on e-transactions was anticipated by most individuals in the digital space.

However, he asserts the e-levy was introduced before the anticipated time and “this will be a problem for businesses and the country’s economy.”

Speaking to Samuel Eshun on the Happy Morning Show, he stated, “It’s important we put the current issues in context so it doesn’t become more of an emotional debate. This was bound to happen but those of us who have been actively involved in and monitoring the space did not expect it this soon.

There is the same situation that has already happened in countries like Uganda, Congo, Cote D’Ivoire, and Malawi. These four countries have also received backlash from their citizens, with Uganda and Congo further reducing the tax levy by half.

They’re now at 1% and there’s no country with a tax rate over 1.7% or 1.5%. Uganda who imposed the 1% is currently implementing 0.5% because of the impact it had on consumers.”

Mr Laryea argued the government have double-taxed Ghanaians by taxing the medium rather than using the medium to pay taxes, with what he described as “the tool that can be used to pay taxes are now taxed as we pay tax.”

“We can use mobile money today to pay taxes and that is how you widen the tax net. Now in paying taxes, we’re going to be taxed and that is the problem we need to fix as a country.

We need to find a way to get people to use mobile money services to pay taxes and this is what I believe, especially as we are digitizing the economy. We’re yet to get there.

It is important that as we are capturing people on national IDs and property addresses, we get to a stage where we would be having a formalized and goal enhanced economy where these would stimulate people to pay taxes,” he explained. He is convinced Ghanaians would oppose the levy and move towards physical cash transactions to enhance their profit gains.

The Director for Africa Digital Economic Forum urged the government to reconsider its stance on the e-levy and develop appropriate implementation for it to facilitate business transactions to shrug off the burden it imposes.