The People’s National Convention (PNC), has expressed its misgivings about government’s decision to slap taxes on all forms of electronic transactions dubbed E-Levy. In a statement signed by the party’s General Secretary, Janet Asana Nabila on Friday, November 19th 2021, the party explained that though it appreciates government’s ambition to widen the tax net, the charges slapped on the masses are so exponential that it has the proclivity of killing the latter’s interest in transacting businesses electronically.
According to the statement, the current cost of living coupled with the new taxes will further exacerbate the plight of the people, contrary to the government’s motive of assuaging the people’s sufferings.
“As a country, we are in difficult times; cost of living is rising, farmers are bitterly lamenting of inadequate basic farm inputs, traders are complaining of the high cost of doing business, the list goes on and for that, we expect prudent measures that would alleviate the sufferings of the masses. The rate is too high and stands the chance of discouraging citizens from transacting businesses electronically,” portions of the statement said.
The Finance Minister, Ken Ofori Atta during the presentation of the 2022 budget statement and economic policy on Wednesday, November 17 2021, said all forms of electronic transactions, including mobile money, merchant payments, bank transfers as well as remittances will attract levies from government. According to the minister, effective January 1, 2022, all E-Transactions of GHC 100 and above will attract a tax percentage of 1.75.
He said revenue extracted from E-Levy will be used to embark on road infrastructure in the country. Touching on the abolishment of the toll booth levy, the PNC says it is enthused with the move on the basis of the fact that toll booths on roads among other things, are a nuisance to drivers.
The party however demanded government finds a way of absorbing the toll booth officers since the majority of them are physically challenged.
Meanwhile, speaking to Mark Kwasi Ahumah Smith on A1 Radio’s Reporters’ Visit, the General Secretary of the PNC Madam Nabila Asana stressed the need for government to quickly address the concerns raised about the E-levy. She was particularly worried about the comments of the Communications Minister, Ursula Owusu who suggested that if a Ghanaian is able to send more than 100gh a day, then the said individual is not poor.
Madam Nabila Asana questioned the grounds on which the minister made those remarks.
“When you get to the ‘Kayayee’ line, the money that they get, they put it into Momo. When they call from the house that your father is feeling well, your mother is not feeling well; it is the MoMo that they use as their banking means to transfer money to their relatives. So if your father is not well and you are trying to transfer GHC 100 from your account, does that make the ‘ ‘Kayayee’ person a rich person?” she quizzed.
Below is the full statement;
PEOPLE’S NATIONAL CONVENTION (PNC) STATEMENT ON THE 2022 BUDGET
PNC receives the 2022 budget statement with mixed feelings as many other organizations and the general populace do. In the budget, there is some good news whereas there are equally bad ones. Sustaining the flagship programs such as the Free SHS, LEAP, Digitization Agenda, Jobs and development initiatives such as the NABCO program, YEA, Youth in Afforestation program and NAELP is good news.
Another good news is the introduction of a new program, the Youstart initiative. As reported on paragraph 101 of the 2022 budget statement ‘the YouStart initiative which proposes to use GH¢1 billion each year to catalyze an ecosystem to create 1 million jobs and in partnership with the Finance Institutions and Development Partners, raise another 2 Billion Cedis. In addition, our local Banks have agreed to a package that will result in increasing their SME portfolio up to GHC 5 billion over the next 3 years. This, Mr. Speaker results in an unprecedented historic 10 Bn Cedis commitment to the private sector and YouStart over the next 3 years.’
Should this initiative be implemented religiously and better than the former ones it will go a long way to alleviate the suffering of the teaming youth of the country. Business Incubation Centers must be established by implementing agencies to review and assess proposals. Selection for funding must be devoid of party politics. Upon selection, financing should be done by the banks (logistic financing) to minimize risk of misappropriation and non-payment of loans to successful applicants. These new business owners must be coached and mentored over time to ensure sustainability and value for money invested.
Figures regarding the macroeconomics variables, such as the inflation rate, debt to GDP, the primary balance amongst others have not been favourable with the finance minister attributing that to the wrath of COVID 19 pandemic on our economy. This assertion questions his earlier claim of the strength and the resilience of the economy before the pandemic.
As a country we are in difficult times; cost of living is rising, farmers are bitterly lamenting of inadequate basic farm inputs, traders are complaining of high cost of doing business the list can go on, and for that we expect prudent measures that would alleviate the suffering of the masses. The introduction of the E-Levy (a very high rate) couple with a propose 15% increase in fees and charges by state institutions would not ease the suffering of the masses.
We contend as stated on paragraph 31 ‘This Budget is intentional about Building a Sustainable Entrepreneurial Nation through fiscal consolidation and Job Creation. This may be an uncomfortable transition but we are a people who think deeply and we must progress and become a people who also make things for ourselves and the World. We must embrace this challenge of becoming a vibrant entrepreneurial nation.’ The uncomfortable transition must not be one that could break the camel’s back. The rate is too high and stands the chance of discouraging citizens from transacting businesses electronically. We recommend that the government should negotiate with the telecommunication companies to either abolish or reduce the charges for persons initiating transaction but those who withdraw cash using mobile transaction should pay the full Levy. Ghanaians should not be taxed for being efficient in going cashless. Government must sustain the increasing usage of momo by the huge percentage of the unbanked Ghanaians; making it more attractive with affordable charges and not exorbitant ones. This underscores the policy of digitization and inclusiveness.
Admittedly, the road toll collection points on our various roads are nuisance, causes unnecessary traffics, and making movement of goods and rendering services from one point to another very costly, yet removing them should take into consideration the revenue collectors at the toll booth. The PNC demands that the revenue collectors should be put on alternative livelihood programs as a number of them are vulnerable women and physically challenged persons. The local assembly must engage affected hawkers in providing alternative markets for them. We further demand that the government be more transparent and accountable to the Ghanaian populace with respect to the various roads that will be fixed through the collection of this levy.
We assure Ghanaians, that a future PNC government shall institute strong measures to plug leakages in the economy in order to increase revenue mobilization. The PNC shall equally pursue a program to rope in more working Ghanaians to pay direct taxes thereby reducing the tendencies to indirectly levy Ghanaians on almost all essential goods and services. Again, the PNC shall prioritise its expenditures to stimulate growth and ensure local productions of our basic needs thereby cutting down on imports and implement pro-poor policies to eradicate poverty.
PNC: Service with honesty.
Janet Asana Nabila
Source/www.a1radioonline.com/101.1mHz/Elijah Beyeni Yenibey/Ghana