The electronic levy on the agreement to implement it in the country, raised several disputes until there was a bill passed by the government to make the e-levy working in the country.
E-Levy has been passed by Parliament, with the rate reduced from 1.75% to 1.5% — with a Minority caucus staged a walkout.
As the E-Levy was passed, following everything about the electronic transaction Levy (E-Levy) on Tuesday, March 29, 2022, the Ministry of Finance has issued a document with guidelines towards its full implementation in May 2022.
Though President Nana Addo Dankwa Akufo-Addo has not assent to the Bill, the Ministry of Finance has made this document available for the general public, with more questions answered for Ghanaians.
Today, the information is available to us at Latest Ghana, and here is all you need to know about E-Levy in Ghana — Frequently Asked Questions About E-Levy 2022
Table of Contents
Frequently Asked Questions About The E-Levy in Ghana 2022
What Is E-Levy?
The E-levy is a tax imposed on electronic transfers charged at the time of transfer. The levy shall be administered by the GRA and collected through licensed Banks, Specialised Deposit-Taking Institutions, Payment Service Providers (PSPs), and Electronic Money Issuers (EMIs).
What Is The Rate Of The Levy?
The levy is 1.50% of the value of the electronic transfer.
Why Has Government Decided To Levy Electronic Transfers?
- To expand the tax base
- To increase domestic tax mobilisation due to Ghana’s low tax-per-GDP ratio compared to its peers and other developing nations. (South Africa – 26.7%, Senegal – 16.4, SSA average-16.5%, Ghana – 12.2% in 2019). Currently, Ghana’s Tax-to-GDP for 2021 is 13.4%.
- To provide an opportunity for every Ghanaian to contribute towards nation building
- To reduce dependence on debt and borrowing
What Will The Revenue Generated By The E-Levy Be Used For?
The proceeds shall be used to tackle:
- the seemingly intractable and hydra headed challenges of high youth unemployment;
- inadequate and poor physical digital infrastructure, including, in particular, roads;
- rising public debt; and the
- diminishing entrepreneurship culture of Ghanaians
How Will The Levy Be Applied?
The levy will be applied on the value (amount) of transfer above GHS100 on a daily basis. That is, after one hundred Ghana Cedis (GHS 100) a day cumulative transfer, the e-levy will be applied. In other words, if the total amount sent in a day is not more than GHS 100, you will not pay E-levy.
For example, if Kofi sends GHS 50 to his sister in the morning and send another GHS 50 (GHS 100 in total) to his brother in the afternoon, he will not pay the E-levy.
However, if Kofi makes any other transfer in a day after the money sent to his brother, the transfer amount will attract the E-levy (i.e. 1.50% of any amount above the first GHS 100).
Who Is Responsible For Charging The E-Levy And How Will It Be Charged?
The levy will be charged whenever a person makes a transfer. The charging entity will add the levy to the transfer amount and charge both the person’s wallet or account. The entity will then pay the levy collected to Government.
The entities responsible for charging the
- The mobile money operators (MTN MoMo, Vodafone Cash, AirtelTigo Money, Zeepay Mobile Money and G-Money)
- Payment Service Providers such as E-Tranzact, GHANA.GOV, Korba, etc.
- All banks
- Specialised Deposit taking institutions such as rural and community banks, savings and loan companies, finance houses etc.
- The Minister also has the power to add to the list through Regulations
Who Will Be Collecting The E-Levy?
Government, through the Ghana Revenue Authority will set up a platform to collect the E-Levy in collaboration with licensed Electronic Money Issuers (EMIs), licensed Payment Service Providers (PSPs), licensed Banks, specialized deposit-taking institutions, and any other entity desinated by the Minister
What transaction fall under the E-Levy?
Any transfer to or from a mobile money account or from a bank account of a person will be subject to the tax. These include:
- Transfers done on the same mobile money network – For example, sending money from your MTN MoMo wallet to another person’s MTN MoMo wallet.
- Transfers from one Mobile Money network to a recipient on another network – For example, sending money from your MTN MoMo wallet to another person’s AirtelTigo Money wallet.
- Transfer from bank accounts to mobile money accounts: For example, Francis Amoah transfers money from his Access bank to PC Boss’ MTN Mobile Money wallet.
- Transfers from mobile money accounts to bank accounts: For example, PC Boss transfers money from his AirtelTigo Money to Francis Amoah’s Access Bank account.
- Bank transfers on a digital platform or application which originate from a bank account belonging to an individual: For example, Kwame transferring money from his NIB Bank account to Akua’s Prudential Bank account.
What Transactions Are NOT Covered By The E-Levy?
The following transfers are excluded from the levy:
- Cumulative transfer of GHS 100 per day made by the same person: Everyone has a daily tax-free threshold (Limit) GHS 100 – that is every person will be able to send up to GHS100 a day without the payment of the levy;
- Transfer between accounts owned by the same person: if you are sending money to your own account (i.e., of the same person) then you will not be charged the E-Levy. A transfer from Kojo’s Tigo wallet to his MTN wallet or from his CBG bank account to his GCB bank account or from his savings account to his current or investment account, will not attract the levy.
- Transfers for the payment of taxes, fees, and charges: Any payment of taxes fees or charges made to an MDA or MMDA using the Ghana.gov platform or other designated method, do not attract the levy.
- Electronic Clearing of Cheques: Clearing of cheques by the banks and specialized deposit taking institutions such as the savings and loans companies tec. are excluded.
- Specified merchant payments: Payments made to commercial establishments through a payment service (Mobile money, bank application, FinTech etc.) to a person registered with the Ghana Revenue Authority for the purposes of income tax or value-added tax included. This applies to both online and physical sales.
- Transfers between principal, agent, and master-agent accounts: To avoid charging the levy multiple times transfers that pass through multiple service providers before they get to the actual recipient do not attract the levy.
Are Utility And Airtime Payments Subject To E-Levy?
- Yes. Once the payment is made from a mobile money account, bank account, or through a merchant payment platform; and exceeds the GHS 100 daily threshold the levy is payable.
Will The Levy Be Charges On Payments Of Wages And Salaries Using Mobile Money?
If the company is registered with GRA for income tax or VAT and salary payment is made from a corporate bank account, there will be no e-levy charge on the amount.
Will There Be A Threshold Above Which E-Levy Charges Will Not Apply?
- No, there is no threshold; the E-levy applies to all transfer amounts.
Will ATM Withdrawals Attract E-Levy?
- No, ATM withdrawals are excluded from the E-levy
Will Mobile Money Qwikloan Attract E-Levy?
Loan repayments will not attract the Levy is the recipient is registered with the GRA for Income tax or VAT. Otherwise, the sender will pay the E-Levy.
Will There Be A Separate Bank Account To Collect The E-Levy?
By law, all revenue collected by the GRA, including the E-Levy, shall be paid unto the Consolidated Fund.
We Are Encouraged To Pay Our Taxes Through Ghana.gov. Will Tax Payment Made Through Ghana.gov Attract E-Levy?
- No, any payment of taxes, fees or charges made to an MDA or MMDA using Ghana.gov platform or other designated system is excluded from E-Levy.
When Will The E-Levy Come Into Effect?
- The E-Levy will come into effect after approval by Parliament.
If I Encounter Some Trouble, Who Can I Call?
A 24-hour service centre will be set up to help individuals who may need further clarification or who might be experiencing any challenges. The call line will be announced shortly.
Check Out The Signed E-Levy Leaflet For The Frequently Asked Questions
Frequently Asked Questions About E-Levy In Ghana
According to him, the Ghana Revenue Authority and the Controller and Accountant General Department will be the revenue collectors of this levy.
On 17th November 2021, the Minister for Finance announced during the presentation of the 2022 Budget Statement and Economic Policy of Government to the Parliament of Ghana, the introduction of an “Electronic Transaction Levy” or “E-Levy” of 1.75 percent on electronic transactions above GHs 100 (US$16) per day to take
The E-levy bill, passed on Tuesday, will introduce a 1.5 percent tax on electronic money transfers and transactions. President Nana Akufo-Addo’s has said the move will help address problems from unemployment to the country’s high public debt.
The Government of Ghana said that the introduction of the levy was due to the rise of the use of digital platforms for transactions because of the COVID-19 pandemic.
A tax rate is the percentage used to determine how much a property taxpayer will pay. A levy represents the total amount of funds a local unit of government may collect on a tax rate. In other words, the levy is a cap on the amount of property tax dollars a local government is allowed by law.
1.75% is the rate of the E-levy which the Government decided to apply on all transactions.
The electronic transfer levy (e-levy) of 1.5% was introduced in the 2022 Budget Statement to widen the tax net and rope in potential…
If the receiver is made to bear the entire burden of the e-levy, it would offer the following two benefits: incomes would be taxed – and not the medium of payment, and secondly, Ghana’s informal sector workers would now pay income tax.
The Parliament of Ghana has finally approved the controversial electronic levy. This was passed on Tuesday, March 29, 2022, after it was put to a voice vote by the Speaker of Parliament Alban Bagbin.
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