1.7% applicable rate to be charged on all electronic transaction
The Minister of Finance, Ken Ofori-Atta, has indicated that government will place a levy on all electronic transactions, known as the Electronic Levy, as a means of widening the tax net.
According to him, it has become clear that there is an enormous potential to increase revenue from taxes by bringing into the tax bracket transactions being undertaken in the informal sector.
He indicated that COVID-19 contributed to the acceleration of the digitalization drive of Africa and data from the Bank of Ghana has shown a growing trend in online trade thus increasing the value of digital transactions from February 2020 and February 2021 alone to 120%.
He made the declaration on the floor of parliament while delivering the 2022 budget and fiscal policy statement on Wednesday, November 17, 2021.
The budget presentation is in line with Article 179 of the 1992 constitution.
Addressing members of parliament, the finance minister said that, “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 Levy or E-Levy.”
He continued that “electronic transactions covering mobile money payments, bank transfers, merchant payments and inward remittances will be charged at an applicable rate of 1.75%, which shall be borne by the sender except inward remittances, which will be borne by the recipient”.
Mr. Ken Ofori-Atta was quick to note that portions of the proceeds from the E-Levy would be used to support entrepreneurship, youth employment, cyber security and road infrastructure.
He stated that the “electronic tax is one and we shall all pay”