Less than 10% of the working class are registered taxpayers – majority leaders
Majority leader in parliament, Osei Kyei Mensah Bonsu, said it was worrying that less than 10 percent of the total working population in Ghana are registered taxpayers.
He wondered how the government could use these statistics to generate enough income to start development projects.
At a budget workshop for the post-2022 period in the regional capital of Ho de Volta, Suame lawmakers said the weekend the government had not been able to raise enough domestic revenue to develop the country.
“Our inability to generate enough domestic revenue to meet government spending with less than 10 percent of the total working class registered as taxpayers, how can the government implement policies and programs to improve the living conditions of Ghanaians?
“This is quite worrying and requires urgent action.”
He added, “Another area that needs attention is the efficiency of government spending. Increasing the allocation on its own may not lead to social and economic results unless specific measures are taken to correct the marked inefficiency in spending.
“Here I believe that, as I keep saying, the committees of Parliament have an obligation to monitor and keep track of the allocations to the various economic sectors in order to reassure our compatriots that it is indeed value for money the expenses that are made on behalf of the people of this country. “
At the same forum, minority leader Haruna Iddrisu said that his side in parliament would not support the controversial proposal on e-tax policy in the 2022 budget.
According to him, the levy acts as an obstacle to the growth of the digital economy.
He said: “Mr Spokesman, understandably we see the Finance Minister trying to introduce some measures, including the now popularly declared e-toll, or digital toll, as some call it.
“Mr. Sprecher, our concern is whether the e-toll itself is not and will not be an obstacle to the growth of the digital economy in our country. We are convinced that the e-surcharge in our country can also be a barrier to investment and an obstacle to the development of the private sector. We in the minority cannot and will not support the government in introducing this special e-toll. We are unable to reach a national consensus on this particular issue. “
The introduction of the tax raised concerns among some of the Ghanaians.
For example, in Key Points on TV3 on Saturday November 20th, the National Democratic Congress (NDC) communications officer, Sammy Gyamfi, said the government was punishing Ghanaians for their own recklessness after the introduction of these taxes.
“They punish Ghanaians for their ruthlessness,” said Sammy, among other things.
Dr. Alex Ampaabeng, a financial policy specialist at Oxfam, also said on the same show that minority MPs should be blamed if disapproved of.
He stated that the approval of the 2022 budget, presented to Parliament on Wednesday November 17 by Treasury Secretary Ken Ofori Atta, will require legislative support from both sides of the House.
If the tax on mobile money transactions (e-levy) is approved by parliament, the MPs of the National Democratic Congress should therefore also be held liable, not just those on the government side.
“That’s the first point I want to make,” he said.
He said the tax will counteract the government’s agenda of ensuring a cashless tax rate as people will now resort to cash transactions.
Because of the outcry over this policy proposal, Energy Minister Dr. Mathew Opoku that a lot of education is needed about the e-toll introduced in the 2022 budget.
On TV3’s New Day show, he said the levy affects certain transactions, not all.
“Implementation will come with education, not everything that is involved. For example, fewer than a hundred cedis transactions are not affected. There is a lot of education to be done, “the MP from Manhyia South told TV3’s Johnnie Hughes on Thursday, November 18th.
For his part, his colleague for Ningo Prampram, Samuel Nartey George, said the government failed to hire telecommunications companies until it announced the introduction of the tax on mobile money services in the 2022 budget.
“Let me put on record that the government has not hired any of the telecommunications service providers to implement the draconian ‘digital tax’. How do you announce a tax when those who implement and are affected by it are left in the dark? Unsuspecting bunch, ”he said in a tweet.
He added, “The NCA and the Department of Communications are now inviting telecommunications and service providers in the room to meet on Friday to discuss the implementation of a budgeted policy? Such an unsuspecting bunch of managers. Post facto thinking. “
Treasury Secretary Ken Ofori-Atta announced a new tax that the government will impose on all electronic transactions in 2022 in order to expand the tax network in the informal sector.
“It is becoming clear that there is tremendous potential to increase tax revenues by including transactions in the tax bracket that could best be made as in the ‘informal economy’,” Ofori-Atta said on Wednesday 17th October the 2022 budget in Parliament.
“After careful consideration, the government has decided to impose a tax on all electronic transactions in order to expand the tax network and tax chain in the informal sector. This is known as an ‘electronic transaction levy or e-levy’. “
He stated that the new e-toll will charge a 1.75 percent fee on all electronic transactions that include mobile money payments, bank transfers, merchant payments and incoming transfers, with the exception of incoming transfers that are borne by the recipient.
However, this does not affect transactions that add up to GH ¢ 100 per less per day.
“A portion of the revenue from the E-Levy will be used to support entrepreneurship, youth employment, cybersecurity, digital and road infrastructure, among other things.”
This new submission is scheduled to begin on Saturday, January 1st, 2022.
In 2020, the total value of transactions was estimated at over 500 million GH, with the number of subscribers and users of mobile money growing by 16 percent in 2019.
According to a report by the Bank of Ghana, Ghana saw the value of digital transactions increase over 120 percent between February 2020 and February 2021, compared to 44 percent in the period February 2019 to February 2020 due to the convenience offered.
This was definitely compounded by the advent of Covid-19, especially during the lockdown.