On Wednesday, March 26th, Parliament successfully passed a bill to repeal the Electronic Transfer Levy (E-Levy), a tax that had become a significant point of contention in Ghana.
The Ghanaian public has overwhelmingly supported the decision to do away with the E-Levy.
As the last stage of the parliamentary procedure, the approved bill will now be formally sent to President John Mahama for his assent.
The E-Levy, which was implemented in 2022 by the previous NPP government, was intended to levy a 1.5% tax on a range of electronic transactions. These included online payments, bank transfers, and mobile money transfers.
Public Reaction To E-Levy When It Was Passed
Despite supporters’ claims that the fee would provide necessary funds for infrastructure development projects, it faced strong resistance from the general people, corporations, and government officials. These opposing viewpoints expressed worries about the E-Levy’s possible negative impacts on online transactions and the Ghanaian economy as a whole.
Since its implementation, the E-Levy had been the subject of numerous protests and considerable public outcry. Critics consistently argued that it disproportionately burdened low-income earners and those individuals who remained outside the formal banking system (the unbanked population).
The passage of the bill through Parliament signifies a crucial advancement towards the complete removal of the E-Levy. However, the ultimate fate of the bill now rests with President Mahama, pending his official assent.
President Mahama and the NDC had made a firm commitment to abolish the tax, prominently featuring this promise as a key campaign message in the lead-up to their victory in the December 2024 general elections.
During the parliamentary session on Wednesday when the vote was taken, there was unanimous support for the bill, with not a single dissenting voice raised against the move to abolish the tax.
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Other Taxes Targeted for Abolishment
Looking ahead, Deputy Finance Minister Thomas Nyarko Ampem has provided assurances that the COVID-19 levy is also slated for abolishment before the end of the current year.
According to the Deputy Finance Minister, the future of the COVID-19 levy will be considered in conjunction with the Valued Added Tax (VAT) rationalisation process, an initiative that President Mahama’s administration has pledged to undertake.
In an interview with Joy News, the Deputy Finance Minister reiterated the Mahama government’s dedication to eliminating all “nuisance taxes.” He highlighted that the Electronic Transaction Levy (E-levy) and the betting tax have already been successfully scrapped.
In response to a question about the possibility of further tax abolitions, Mr. Nyarko Ampem stated, “At this time, it would be difficult to make any promises, but as the economy picks up, we wouldn’t mind to repeal taxes.”
Deputy Finance Minister Assures COVID-19 Levy Abolishment by End of 2025:
“The COVID-19 levy will be considered alongside the VAT rationalisation process that we have been committed to doing. So, when that process is done, I believe the COVID [levy] would also be removed. I’m looking at towards the end of the year if we are able to finish the rationalisation processes, we would be able to do that.”
He further emphasized that President Mahama remains fully committed to fulfilling all the promises outlined in the ruling National Democratic Congress’s (NDC) manifesto.
He did it well
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