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Ghana will reduce the rate of the controversial Electronic Transfer Levy to 1 percent from 1.5 percent. Finance Minister, Ken Ofori-Atta made this announcement during the 2023 budget presented in parliament on November 24
Ghana will reduce the rate of the controversial Electronic Transfer Levy to 1 percent from 1.5 percent. Finance Minister, Ken Ofori-Atta made this announcement during the 2023 budget presented in parliament on November 24. This review was part of a seven-point agenda aimed at restoring the macroeconomic stability of the country. Of late, the western African country has witnessed several demonstrations against higher inflation and scarcity of essentials including food articles.
The finance minister admitted that the levy which was introduced in the 2022 budget did not yield the expected resources. The government thought the e-levy could mobilize more domestic resources, but the outcome belied the expectations.
Mr. Ofori-Atta said that the government received several proposals for a review of the E-Levy and would work closely with all stakeholders to evaluate the impact of the Levy, which may include the revision of the various exclusions.
The minister said that the headline rate will be reduced to one percent of the transaction value alongside the removal of the daily threshold.
The government reviewed downward expectations for revenue collection from the levy after an initial projection of GHS 7 billion. In July 2022, projections were reduced by about ten-fold to GHS 611 million.
The levy faced stiff opposition in Parliament and was generally unpopular with Ghanaians; three-fourths of Ghanaians disapproved of the e-levy, including 67 percent who “strongly disapproved” of it, according to a recent survey.
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The review downwards of e-levy is undertaken for the second time since it was introduced in May 2022. Initially, the government pegged the levy at 1.75 percent before it was reduced to 1.5%.
