Teaser: Mobile money operators are already playing their role to reverse the e-levy. It is left with the general public to play their part.
A known strategy employed by telecom companies in the past to force the reversal of a tax imposed on recharge credits called the talk-time tax is being employed on the e-levy by the telcos and other implementing institutions. If this tax is not reversed within twelve months, then the citizens actually want to pay it.
The new tax on electronic money transfers, popularly called e-levy, has faced stiff resistance in Ghana. The tax which has been implemented despite stiff public resistance has so much history attached to it. One such history was, for the first time, an exchange of fisticuffs by members of parliament (MPs) from the opposite sides of parliament. The tax, which is in its early stages of implementation, is still hoped by the public that it will be reversed.
The mobile money telecom networks, which are the bigger charging entities together with other financial institutions who are supposed to collect a one and half per cent (1.5%) tax on any amount being transferred, are adopting a known strategy which was used in the past to aid the reversal of the e-levy. When the talk-time tax was increased in the past under the current government, the politicians were angry that the telcos were communicating the then tax to the general public by disclosing how much talk-time specific amount an individual was paying anytime they reload their mobile credits. The politicians were furious for obvious reasons. They wanted to black out the general public on how much they were paying. Moreso, they wished to put the tax blame on the telcos, as though the telcos were the ones charging any extra fee for their service. As usual of any African populist government, who care more about the number of votes they could lose or gain and not care more about making the appropriate decision, the Ghanaian government was angry about the level of transparency the telcos wanted to display by providing tax-specific information to the general public in real time. The government’s stated reason for being unhappy with the telcos was that the telcos did not communicate other tax-specific information to the public apart from the talk-time tax. The government could be right about their suspension of sabotage by the telcos. However, the telcos could also be correct about providing real-time information on the talk-time tax for the sake of transparency and defuse the wrong impression that they were the ones charging extra fees.
The same simple strategy of transparent tax obligation communication by the telcos and other financial institutions is being employed in a subtle attempt to play a known card that could force the government to reverse the e-levy. Having started communicating the e-levy tax in real time, it is unlikely the decision to disclose the tax obligation on a tax-specific basis will be discontinued in the future. In the past, during the era of the talk-time tax increase, every attempt to force charging entities to stop tax-specific communication failed. It was rather the Government who reversed the increment of the talk-time tax below the level it was before they assumed governance.
There is no doubt the government studied the level of transactions occurring on the platforms of the telcos, before and after the talk-time increment, before taking the decision to reverse the e-levy. The data that was studied should signal a significant reduction in the amount citizens spent recharging their mobile sims. The assumed reduction should have a correlation between the tax specific communication and citizens’ decision on how often they reload their sims. Therefore, since the charging entities of the e-levy are disclosing the tax amount being paid in real time to the general public, for the purpose of transparency and/or for political pressure, it is the turn of the citizens to play their role with respect to how many taxable transactions they transact. For the citizens to fast track the reversal of the e-levy, individuals must reduce their taxable amounts or taxable transactions below fifty per cent (50). Transactions below 50% should be the data the government’s Economic Management Team would want to see to force them to reverse the e-levy.
Some of the possible ways to avoid paying the e-levy and reduce your taxable amounts are; transferring the tax-free threshold of a hundred ghana cedis (Ghc100.00) a day and all other transactions for the day are done with cash withdrawn from the nearest agent. Also, people can keep their second or third mobile money sims with their dependants or beneficiaries with a snapshot of their IDs to aid withdrawal from such sims after transferring money from the financier’s handheld sims to the sims kept with others, since money transferred between their own accounts is not taxable etc.
The E-levy bill was one of the approved bills by parliament that was assented to by the president of the republic in record time, within forty-eight hours.
Though the bill passed by the Ghanaian parliament has been litigated in the supreme court of the land for lack of voting quorum to pass the bill, the injunction application filled by the plaintiffs in the case has been rejected by the seven (7) sitting justices, on the basis that any tax collected from the general public can be refunded back to the public and not vice-versa. The plaintiffs are minority leader in parliament and MP for Tamale Central Constituency, hon. Haruna Iddrisu, MP for North Tongu, Hon. Samuel Okudzeto Ablakwa and MP for Bawku Central Mahama Ayariga