ACCRA, Ghana—One country is said it plans to tax electronic transactions.
Ghana’s finance minister, Ken Ofori-Atta, said the government intends to introduce an electronic transaction levy (e-levy) in its 2022 budget as part of an effort to “widen the tax net and rope in the informal sector,” according to Quartz Africa.
The proposed levy, which will go into effect on Feb. 1, 2022, is a charge of 1.75% of the value of electronic transactions. It covers mobile money payments, bank transfers, merchant payments, and inward remittances. The originator of the transactions will bear the charge except for inward remittances, which will be paid by the recipient. There is an exemption for transactions up to $16 per day, according to the report.
Justification for Levy
According to the finance minister, the total digital transactions for 2020 were estimated to be over $81 billion, compared to $12.5 billion in 2016—a huge growth in just five years, Quartz Africa noted.
“While the justification for this new levy is to widen the tax net, since the majority of the population make a living in the informal sector, it seems a convenient means to increase government revenue,” Quartz Africa said.