Ghana Supreme Court Hears Case Against E-Levy Tax
Ghana’s Supreme Court will hear an application to stop the implementation of the controversial Electronic Transfer Bill.
The Electronic Transfer Bill, also known as the E-Levy Bill, was signed into law in March 2022. It charges a tax of 1.75% of the value of electronic transactions. Members of Ghana’s minority party, the National Democratic Congress, have pushed to stop the implementation of the bill arguing it violates the 1992 constitution.
The bill has become a major point of contention as proponents argue it will expand Ghana’s tax base by including the informal sector. It has received backlash from a large portion of Ghana’s population which relies heavily on digital payments. Much of Ghana’s economic activity takes place within the informal economy made up of small business and low-income workers in rural areas.
Expect the E-Levy Bill to remain in place given Ghana’s need to increase its revenue base. In the short term, informal workers and small business owners are likely to reject the bill by returning to cash payments. In the long term the public’s will gradually accept the E-Levy platform. Ghana may decrease the tax percentage, in line with other states that have implemented similar taxes and received backlash.
