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E-levy should be reviewed to between 0.5 – 1% – Economist

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A review of the E-levy to between 0.5 and 1 percent is essential for the development of digital payment systems, thus hugely removing the traditional cash payment systems. The same review would also show that government would be able to rake in more money to support local development. 

Dr. Samuel Worlanyo Mensah, an Economist suggests that the government would have to take advantage of the opportunity that 2023 Budget Statement and Financial Policy presents to create a win-win situation for the mobile money operators, users of digital payment platforms and the government itself. 

He said this when he spoke on A1 Radio’s Day Break Upper East Show. 

“I believe that the E-levy is not a bad policy but I think the implementation raised so many challenges. Government didn’t deem it necessary to back it with a lot more public education and sensitization until when people began to raise red flags. I think, fundamentally, the rate is too high. 1.5 percent is too high. They should study the impact very well and they would realise it has affected businesses. It has also increased the cost of doing business. Definitely, that cost would be transferred to the final consumer,” he said. 

In Dr. Wolarnyo Mensah’s opinion, the E-levy should hover between 0.5 and 1 percent. This, he said, gives businesses the opportunity to thrive while also encouraging digital payments. 

The Chief Executive Officer of the Ghana Telecommunications Cham­ber has called for the reduction of the electronic transactions levy (E-levy) from 1.5 per cent to 0.1 per cent.

According to Dr Ken Ashigbey, the introduction of the e-levy at 1.5 per cent had proven counter productive to both the government and the development of Gha­na’s digital economy.

He explained that while calling for a total scrap of the tax measure would be insen­sitive considering the government’s dire need for money amidst economic turmoil, reducing it to 0.1 per cent would revamp the digital economy thus generating more revenue for government.

Speaking on JoyNews’ PM Express Busi­ness Edition on Thursday, he said, “Our proposition is the fact that, you know, they should scrap it. But we need to be real, the government needs money at this particular stage. The deficit position is not good for the industry, it affects the industry, and it’s one of the things that would account for the depreciation of the cedi. The macros would be destabilised.

He said “the best thing to do is to reduce the level. Some in the industry have talked about 0.5, but I have said that the best thing to do is to do 0.1 per cent.”

Source: A1radioonline.com|101.1MHz|Mark Kwasi Ahumah Smith|Ghana

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