Director of the Institute of Statistical, Social, and Economic Research (ISSER) Professor Peter Quartey, has called on the government to reduce the proposed 1.75% levy on all electronic transactions to 0.5 percent.
According to him, executing the bill is critical for economic stability, which is why it needs to be reviewed to improve financial inclusion.
Speaking at ISSER’s 2022 budget review statement on Monday, November 29, 2021 on the theme, Building a sustainable entrepreneurial nation: Fiscal consolidation and job creation, Prof. Quartey explained that “the need for revenue augmentation is reasonable, and we need to raise more money; nonetheless, taxing electronic transfers is a viable option. Our proposal will be a 0.5 to 0.75 percent fee, which will be low but still allow people to enjoy the service, even if they protest, and will in the short term yield more revenue. We believe the 1.75 percent is punitive”.
Finance Minister Ken Ofori Attah in his presentation of the 2022 budget disclosed a new tax measure ( E_ Levy ) that will be applied only to the originator of transactions on electronic payments, which includes Fintech platforms, online banking, and mobile money platforms.
The new measure, according to the government is aimed at raising funds to relieve the country’s debt situation which has escalated as a result of COVI-19 and its related challenges.
Prof. Quartey offered his opinion on the abolition of all tolls on public roads and bridges, stating that automating the system rather than completely removing it is the better option.
“ We think if you want to decongest the toll, then invest a bit in the network and then revive the E- pass system so that you can still raise your revenue. My fear is that if you start promoting Public-Private Partnership and you have a system where people are used to using the road for free and you later want to toll a newly constructed road, there will be a lot of resistance”.
He, therefore, urged that the budget be revised and passed immediately to prevent repercussions on investor confidence.