The former finance minister has charged government to rethink the e-levy seriously before introducing it. He stressed that the need for serious rethinking on the introduction of the E-Levy before it is imposed.
The former finance minister made these comments at a 2022 Budget Review organised by PFM-Tax Africa Network in a virtual meeting on Wednesday (24 November).
Because the mobile money sector is a relatively new sector, he argues that taxation of financial services in the cashless economy should be directed on a more mature area of the industry.
Consumers, according to Terkper, are already paying the existing Communication Service Tax (CST), which has a similar goal to the E-Levy. it also aims at stimulating businesses and providing job opportunities for the youth.
He said, “All the telcos attract VAT, whether the VAT is sound or not, businesses pay and these elements go into consumption tax already. So, that’s the point that we’re making and the basis on which some of us think that the E-Levy needs a rethink.”
“CST is a service tax and is a consumption tax because ultimately it is consumers that are going to pay. Even though it is businesses that are supposed to pay, it’ll be pushed to the consumer,” he added.
2022 Budget
“Electronic transactions covering mobile money payments, bank transfers, merchant payments and inward remittances will be charged at an applicable rate of 1.75% which shall be borne by the sender except for inward remittances, which will be borne by the recipient,” Ofori-Atta said.
There has been mixed reactions over the announcement of the e-levy by government.
story by Ernest Nana M.
