Member of Parliament for Ningo Prampram, Sam Nartey George, has described government’s proposed e-levy introduction in the 2022 budget, intended to tax mobile money transactions and remittances in the country, as a “Ponzi scheme”.
According to him, taxation that takes out the “real value” of the money in “one year is going to collapse the mobile money industry”. Sam George revealed that if government is taking out the “GHC8 billion” it is projecting to raise from the levy introduction, then it is basically taking out the “capital of the business”.
Sam George explained that government is engaging in not just double taxation but “multiple layers of taxation”, a move, the corporate governance system in the country is against.
“This e-levy is at best a taxation Ponzi scheme. It is a Ponzi scheme that is targeted at maximizing profit at the detriment of people who put their money in. Government is looking to raise between GHC 7 and GHC8 billion from the e-levy, largely on the back of momo transactions. The total amount of money on float in the country in 2020, which is the real cash that people have put into the mobile money eco-system is GHC8 billion”.
Mr Sam George
Government, the Ningo Prampram legislator disclosed, is looking at the total value of transaction which is“GHC571.9 billion” in the country with the intention of making some GHC8 billion with respect to projected revenue to be accrued . However, he insisted that what government has failed to take cognisance of is that “the real cash in there is GHC8 billion” . This, Sam George revealed, implies that in one year, government is going to basically take out all the “cash in the ecosystem”.
Buttressing his point on how he came by the GHC8 billion, Sam George opined that the figure for the mobile money transaction came from the Bank of Ghana since it regulates that industry and not the NCA and ministry of communication. As such, the companies are meant to “keep cash inflow” per the law parliament passed.
Minority kicks against e-levy introduction
The minority in parliament had earlier vowed to kick against the government’s proposal for a 1.75% tax on all electronic financial transactions. Speaking on the issue, Minority Leader, Haruna Iddrisu, revealed that the tax is a disincentive to investments and private sector development.
Commenting on the proposed e-levy and why the minority won’t “approve”, Sam George questioned whether one shouldn’t “be bothered” that government has come to announce a policy initiative of this kind in the budget without “thinking it through”. He asserted that the e-levy has three components which includes the 1.75% on all momo transactions, 1.75% on all financial transactions and then 1.75% on all inward remittances.
Sam George averred that during a stakeholder meeting on Friday between stakeholders and the ministry of communication and NCA, critical questions were asked from the ministry and they “had no answer”.
“So, government has introduced a levy in our budget which is supposed to kick in on the 1st of January and you expect me as a member of parliament to approve that budget, approve the policy, approve the estimate and approve appropriations for a policy the government doesn’t understand”.
Mr Sam George
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