The Deputy Minister of Energy and MP for Sekondi Constituency, Andrew Kofi Egyapa Mercer has claimed that the Parliament of Ghana played a huge role in the crippling of Ghana’s economy.
According to him, Parliament breached the law by not passing the e-levy bill early enough and that singular act from Parliament, has contributed massively to the economic challenges in the Country today.
“The Parliament of Ghana with our eyes opened knowing very well the consequences of our not complying with the law bridged it.
“We bridged the law by not passing the e-levy bill. We did not pass it and we knew there will be consequences.”
Egyapa Mercer, Dep. Minister of Energy
He claimed that since the e-levy was a major medium government sought to use in generating income, Parliament’s failure to pass the bill at the time when it approved the expenditures of government was a bridge of the public financial management act.
“In December last year Parliament breached section(22) of the public financial management act,” he claimed.
Article (921) Section (22) of the public financial management act reads:
(a)Parliament shall by 31st December of each financial year consider and approve the annual budget and correlating work plan of government for the ensuing financial year (b) the appropriation’s bill (c) any other bill that will be required to implement annual budget.
Article 921 (22)
Egyapa Mercer’s argument was that Ghana’s economy was downgraded because Parliament approved government expenditure but did not approve the government’s way for deriving income to fund its expenditure.
He questioned, “If you approve expenditures, you [give] authorization to spend but you do not approve the revenue to fund the expenditure, what will happen?”
The MP for Sekondi claimed that when Parliaments decide not to approve revenue measures for funding approved budgets, the resultant effect is the downgrading of economies.
“We [Parliament] participated in causing the harm; our economy is downgraded, it compounds the problems that we’ve had with our economy [pre, post] and during COVID.”
Egyapa Mercer, Dep. Minister of Energy
According to him, e-levy which was government’s principal measure for deriving revenue to fund its expenditures was passed only after the harm was done.
He noted that at the time when the e-levy bill was passed, the conflict between Russia and Ukraine had started and so Ghana’s economy was already sinking.
The Deputy Minister of Energy mentioned that, government had to revise its budget because government could not mobilize enough revenue.
“Then we [Parliament] turned around having gone down the river to muddy it, come down stream and say [the Finance Minister] is the one who has caused our problems,” Egyapa Mercer bemoaned.
The E-Levy Bill
On 17th November 2021, the Minister for Finance announced during the presentation of the 2022 Budget Statement and Economic Policy of government to Parliament, the introduction of an electronic transaction levy popularly called e-levy of 1.75 percent on all electronic transactions.
The Finance Minister mentioned that the move was necessary to widen the tax net, which would increase the Country’s tax to GDP rate from 13% to about 16% or more.
However, the minority group in Parliament was vehemently opposed to the levy arguing that a 1.75% tax would exacerbate the plight of Ghanaians who were just recovering from the severe impact of the COVID-19 pandemic.
Nevertheless, government remained resolute in passing the bill and on 25th January, 2022, the Finance Minister submitted a revised version of the e-levy bill to Parliament.
The initial proposal was modified to allow some exemptions on certain specific transactions.
The minority was still not interested in passing the bill and in fact, on 22nd March, 2022 when the bill was about to be passed, Members of Parliament in the minority group walked out of Parliament.
Regardless, the bill was passed by the majority group and 1st May 2022, Ghanaians started paying 1.75% as e-levy on some selected electronic transactions.
