Okudzeto Ablakwa outlines options the government could use to generate revenue instead of E-Levy

North Tongu MP Samuel Okudzeto Ablakwa offered the government some options it could consider to generate revenue for the country instead of pursuing the implementation of the Electronic Transactions Tax (E-Levy).

In a post on Twitter, he noted that the proposed measures, if implemented, may bring in more than the government’s planned proceeds from the e-tax.

“There is a clear alternative to the e-Levy killer if only President Akufo-Addo and his team were sensitive to the plight of suffering Ghanaians and contained their appetite for debauchery,” Mr Ablakwa wrote.

Among other things, the MP suggested cutting allocations to Parliament and curbing Agenda 111.

He explained that “Agenda 111 remains an impulsive utopia, pull the brakes and save GHS 518 million”.

Below are Mr. Ablakwa’s options on new ways to generate income:

1) Withdraw GHS 2 billion from the GHS 3.1 billion allocated to the Bureau of Government Apparatus;

2) Suspend allocation to GAT and immediately 1 billion GHS becomes available to the government;

3) Negotiate with IPPS and reduce their allocation from GHS 4 billion to GHS 3 billion;

4) Revise the nebulous GhanaCARES program and save another billion GHS;

5) Reduce the contingency vote to GHS 293,007,000 and release some GHS 700 million;

6) Agenda 111 remains an impulsive utopia, pull the brakes and save 518 million GHS;

7) Halve the allocation to the Ministry of National Security and gain some GHS 400 million;

8) Parliament should easily sacrifice some GHS 200 million out of its GHS 600 million allocation;

9) Put the MoF’s fuzzy mortgage financing plan on hold and save GHS 100 million.

Closing the list, Mr Ablakwa added that “put together the above spending cuts and the government immediately raises a handsome GHS 6.918 billion which exceeds the e-Levy projections”.

Electronic direct debit

Finance Minister Ken Ofori-Atta, during the presentation of the 2022 budget on Wednesday November 17, announced that the government intended to introduce an electronic transaction tax (e-levy).

The levy, he revealed, is introduced to “widen the tax net and the rope in the informal sector”. This followed an earlier announcement that the government intended to stop the collection of road tolls.

The proposed levy, which was to come into effect in January 2022, is a 1.75% charge on the value of electronic transactions. It covers mobile money payments, bank transfers, merchant payments and inbound remittances. There is an exemption for transactions up to GH¢100 per day.

Explaining the government’s decision, the finance minister revealed that total digital transactions for 2020 were estimated at over GH¢500 billion (approximately $81 billion) compared to GH¢78 billion ($12.5 billion). ) in 2016. Thus, the need to expand the tax net to include the informal sector.

Although the government has argued that it is an innovative way to generate revenue, dozens of citizens and stakeholders have expressed varying sentiments on its advisability, with many strongly opposing it.

Even though others have argued in favor of the tax, part of the population thinks that the 1.75% electronic tax is an insensitive tax policy that will aggravate the already existing difficulties in the country.

Below is the timeline of electronic direct debit controversies


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