Kusi Appiah Adomako, centre coordinator for CUTS International, has revealed that the cedis performance may be adversely affected due to the fisticuff which ensued among parliamentarians yesterday, December 20, 2021.
According to him, if government is not able to get this levy through, it will be a big blow to government and to everybody because it will create a huge gap between expenditure and revenue. Mr Adomako indicated that this will mean government would have to withdraw some of its social services and that will become bad for the economy.
“So, I think for me, we need to be able to resolve these issues amicably. How do we ensure that this thing does not affect investor confidence? In the short term, this can even affect how our cedi performs. We are looking for the close of business today [and] how the cedi would react to what happened in parliament last night and that is the short term. But I’m very confident that between now and January 7, this issue will be resolved…”
Mr Kusi Appiah Adomako
Touching on the extent to which the country is risking its attractiveness to foreign investors, Mr Adomako noted that last night’s “standoff” is part of our democratic governance. That notwithstanding, he intimated that how parliament resolves some of these things show how matured it is.
The Center Coordinator for CUTS International revealed that getting the e-levy through is not necessarily an NPP success but rather the success for Ghana. He expressed that if the e-levy doesn’t go through, for any new government which comes after 2024, it will have to confront this “albatross”.
“So, what is more important is that the both sides need to meet and resolve this thing amicably. Because if government is able to get this one through, I’m not sure after 2024 election, whoever comes will withdraw it because they oppose it. After all the money doesn’t go into politicians’ pocket, it goes into the public purse to resolve and help in our democratic and developmental needs”.
Mr Kusi Appiah Adomako
Effect of e-levy on businesses
Commenting on the positives of the e-levy, Mr Adomako explained that the levy is helping government to get revenue to resolve its fiscal challenges. On the supply side however, he reckoned that those who will be feeling it, will have issues transferring money from one point to another and government will take 1.75% plus what the platform users will also charge.
Mr Adomako emphasized that it’s going to have effect on doing business in the country and the onus lies on government to ensure that this new levy will not impact heavy on private sector and Ghanaians.
“I think the best approach is for government to bring the figure even below 1% and maybe gradually increase it. But starting it at 1.75% for us is very huge… It’s also going to allow some businesses that are into exporting and imports to keep their foreign exchange in an offshore account so that anytime they want to make a transfer, they transfer the money there… That alone can affect the cedi’s performance”.
Mr Kusi Appiah Adomako
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