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'Too high' E-levy can 'discourage' e-transactions – PNC to government

PNC 'Too high' E-levy can 'discourage' e-transactions – PNC to government
NOV 19, 2021 LISTEN

The People’s National Convention (PNC) claims the introduction of the E-Levy, “(a very high rate) coupled with a proposed 15% increase in fees and charges by state institutions, would not ease the suffering of the masses”.

Reacting to the 2022 budget, which proposes a 1.75 per cent levy on all electronic transactions including Mobile Money, the PNC, in a statement signed by General Secretary Janet Nabla dated Friday, 19 November 2021, said: “We contend, as stated on paragraph 31” of the budget thus: ‘This Budget is intentional about Building a Sustainable Entrepreneurial Nation through fiscal consolidation and Job Creation. This may be an uncomfortable transition but we are a people who think deeply and we must progress and become a people who also make things for ourselves and the World. We must embrace this challenge of becoming a vibrant entrepreneurial nation’, that “the uncomfortable transition must not be one that could break the camel’s back”.

In the party’s view, “the rate is too high and stands the chance of discouraging citizens from transacting businesses electronically”.

It added: “We recommend that the government should negotiate with the telecommunication companies to either abolish or reduce the charges for persons initiating transaction but those who withdraw cash using mobile transaction should pay the full levy”.

The party said “Ghanaians should not be taxed for being efficient in going cashless. Government must sustain the increasing usage of MoMo by the huge percentage of the unbanked Ghanaians; making it more attractive with affordable charges and not exorbitant ones. This underscores the policy of digitisation and inclusiveness”.

Read the PNC’s full statement below:

PEOPLE’S NATIONAL CONVENTION (PNC) STATEMENT ON THE 2022 BUDGET

PNC receives the 2022 budget statement with mixed feelings as many other organisations and the general populace do. In the budget, there is some good news whereas there are equally bad ones. Sustaining the flagship programs such as the Free SHS, LEAP, digitisation agenda, jobs and development initiatives such as the NABCo programme, YEA, Youth in Afforestation programme and NAELP is good news.

Another good news is the introduction of a new programme, the YouStart initiative. As reported on paragraph 101 of the 2022 budget statement: ‘The YouStart initiative which proposes to use GH¢1 billion each year to catalyze an ecosystem to create 1 million jobs and in partnership with the Finance Institutions and Development Partners, raise another 2 Billion Cedis. In addition, our local Banks have agreed to a package that will result in increasing their SME portfolio up to GHC 5 billion over the next 3 years. This, Mr Speaker results in an unprecedented historic 10 Bn Cedis commitment to the private sector and YouStart over the next 3 years.’

Should this initiative be implemented religiously and better than the former ones, it will go a long way to alleviate the suffering of the teeming youth of the country.

Business Incubation Centers must be established by implementing agencies to review and assess proposals. Selection for funding must be devoid of party politics. Upon selection, financing should be done by the banks (logistic financing) to minimise the risk of misappropriation and non-payment of loans to successful applicants.

These new business owners must be coached and mentored, over time, to ensure sustainability and value for money invested.

Figures regarding the macroeconomics variables such as the inflation rate, debt-to-GDP, the primary balance amongst others have not been favourable with the finance minister attributing that to the wrath of the COVID-19 pandemic on our economy.

This assertion questions his earlier claim of the strength and the resilience of the economy before the pandemic.

As a country, we are in difficult times; cost of living is rising, farmers are bitterly lamenting of inadequate basic farm inputs, traders are complaining of the high cost of doing business; the list can go on, and for that, we expect prudent measures that would alleviate the suffering of the masses.

The introduction of the E-Levy (a very high rate) coupled with a proposed 15% increase in fees and charges by state institutions would not ease the suffering of the masses.

We contend, as stated in paragraph 31: ‘This Budget is intentional about Building a Sustainable Entrepreneurial Nation through fiscal consolidation and Job Creation. This may be an uncomfortable transition but we are a people who think deeply and we must progress and become a people who also make things for ourselves and the World. We must embrace this challenge of becoming a vibrant entrepreneurial nation.’

The uncomfortable transition must not be one that could break the camel’s back. The rate is too high and stands the chance of discouraging citizens from transacting businesses electronically.

We recommend that the government should negotiate with the telecommunication companies to either abolish or reduce the charges for persons initiating transactions but those who withdraw cash using mobile transactions should pay the full levy.

Ghanaians should not be taxed for being efficient in going cashless. Government must sustain the increasing usage of momo by the huge percentage of the unbanked Ghanaians; making it more attractive with affordable charges and not exorbitant ones. This underscores the policy of digitisation and inclusiveness.

Admittedly, the road toll collection points on our various roads are a nuisance, cause unnecessary traffic, and make the movement of goods and rendering of service from one point to another very costly, yet removing them should take into consideration the revenue collectors at the toll booth.

The PNC demands that the revenue collectors should be put on alternative livelihood programmes as a number of them are vulnerable women and physically challenged persons.

The local assemblies must engage the affected hawkers in providing alternative markets for them.

We further demand that the government be more transparent and accountable to the Ghanaian populace with respect to the various roads that will be fixed through the collection of this levy.

We assure Ghanaians that a future PNC government shall institute strong measures to plug leakages in the economy in order to increase revenue mobilisation. The PNC shall equally pursue a programme to rope in more working Ghanaians to pay direct taxes, thereby reducing the tendency to indirectly levy Ghanaians on almost all essential goods and services.

Again, the PNC shall prioritise its expenditure to stimulate growth and ensure the local production of our basic needs, thereby cutting down on imports and implementing pro-poor policies to eradicate poverty.

PNC: Service with honesty.

-Signed-

Janet Asana Nabila

(General Secretary)

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