This follows an observation that some Ghanaians are avoiding tax payments because of the introduction of the 1.5 percent Electronic Transactions Levy (E-Levy).
At a dialogue on the state of the Ghanaian economy he hosted on a virtual platform, Mr Terkper, who is a Tax Professional, noted that the introduction of the tax measure to increase the Government’s revenue had led people to avoid the payment of the tax.
Rather, many Ghanaians have started dealing directly with MoMo Agents for transfer to avoid the payment of the 1.5 percent levy, which would affect the revised projected revenue of GHS4.5 billion from the initial GHS6.9 billion.
Mr Terkper, who is also a Chartered Accountant, said that due to the delays in the start of the levy and the “high rate” of the tax, the E-Levy would not yield the expected revenue outcome for this year.
He explained that “Because the E-Levy is taxing savings and loans, what it will mean is that if you’re a worker and you go for a loan at the bank and your workers are in the field and you send e-transfers to them, it will attract the tax.”
“For these reasons, people are going to find a way around it, and truly they’ve started by going to deal directly with the MoMo businesses by the roadside to avoid the tax,” he emphasised.
As such, the Tax Professional said that because the levy was delayed from the original implementation date of January to May, it was likely not to yield much this year.
Mr Terkper said the government must implement the needed legislation to allow the Ghana Revenue Authority (GRA) to seal the loopholes.
On the current inflationary pressures, Mr Terkper said there was the need for handlers of the economy to make homegrown policies a critical part of their interventions.
“They need to come up with a homegrown policy. My only worry is that despite the mention of a homegrown policy by government agents I have not seen it. It may exist internally,” he said.
“If it exists in the budget then the markets don’t have any confidence in it. We, therefore, need to do something very drastic on our own, which will be laudable,” he added.
On the country’s debt, which recorded an increase of GHS40 billion from GH¢351.7 to GH¢391.9 billion in March 2022, he cautioned the Government against default.
“I would sound a note of caution and it’s that the
worst thing that could happen to us is to default. Given the fact that our turning to the domestic market to finance the budget is not working out as planned because of the auction shortfalls and the rest,” Mr Terkper said.