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Ghana’s decision to tax mobile money transactions sparks outrage

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A decision by the government of Ghana to introduce a levy on electronic transactions has left many citizens infuriated.

In the presentation of the country’s 2022 budget statement, the country’s Finance Minister Ken Ofori Atta announced that the introduction of the e-levy has been necessitated by the astronomical rise in electronic transactions, hitting $80 billion (over 500 billion Cedis) in 2020.

According to him, between February 2020 and February 2021 alone, Ghana saw an increase of over 120% in the value of digital transactions.

The government is now imposing a 1.75 percent levy on all electronic transactions such as mobile money payments, bank transfers, merchant payments and inward remittances.

“Mr. Speaker, it is becoming clear there exists enormous potential to increase tax revenues by bringing into the tax bracket, transactions that could be best defined as being undertaken in the “informal economy.

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After considerable deliberations, Government has decided to place a levy on all electronic transactions to widen the tax net and rope in the informal sector. This shall be known as the “Electronic Transaction Levy or E-Levy,” he said.

Although the government plans to use some of the proceeds to promote entrepreneurship and create jobs for the youth, many Ghanaians have taken to social media to kick against it.

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Opposition lawmakers to reject the move

Meanwhile opposition lawmakers in Ghana have criticized the government for overburdening Ghanaians with more taxes amid current economic hardship.

They lawmakers intend rejecting the e-levy when voting to approval of the budget takes place.

In the 2022 budget, the government also abolished collection of road tolls in a bid to check pollution and ease traffic.

A GH¢1 billion ($195 million) “YouStart” initiative is also being rolled out annually to support the teeming youth to set up their own jobs.

The government said the initiatives are crucial in building a sustainable entrepreneurial nation.

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Source: Africafeeds.com

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