E-Levy to have unintended consequences on the economy – Dr Ali-Nakyea
Senior Law Lecturer at the University of Ghana, Dr Ali-Nakyea, has averred the implementation of the electronic transaction levy (E-Levy) may have some direct and indirect unintended consequences on the economy.
Making the assertion during a presentation on the E-Levy in Accra, the tax expert noted the E-Levy aside having a negative impact on the country’s financial inclusion drive, will among others result in the unnecessary reduction in disposable incomes of Ghanaians.
According to him, taxing mobile money is in real effect going to reduce the amount of money available to cater for basic needs like health and education.
Adding that the tax will increase the cost of sending and receiving money which will negatively affect value chains in agriculture, access to energy, utilities and trade services.
“In effect, we could lose out at both consumer and institutional levels,” he further remarked.
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Also to be an indirect unintended consequence on the economy will be the risk of promoting money laundering as the levy could drive users off the mobile money platform and resort to insecure cash dealings increasing risks associated with it.
Dr Ali-Nakyea is of the view that the policy requires further deliberations and analysis, and hence is not ripe for implementation in the state in which it has been proposed.
“If it is about the informal sector, the modified taxation system has been identified as capable of dealing with the sector’s contribution to revenue mobilisation,” he remarked.
Concluding his presentation, Dr Ali-Nakyea noted that the impact of the levy may far outweigh the purported and unlikely revenue envisaged by policy makers.
Adding that there is the need to plug loopholes and leakages of revenue to enhance revenue mobilisation.
