Bussiness
E-levy too insignificant to close deficit gap, find better ways – Terkper
Seth Terkper, former Finance Minister, has waded into the raging debate over the Electronic Levy (E-levy) introduced by government in next year’s budget – saying, given the deficit at hand, the levy won’t contribute significantly to addressing the revenue shortfall; hence, better policies and strategies are needed.
Government has projected a deficit of GH¢37billion by end of 2022, as revenue is targetted at GH¢100.5billion against expected expenditure of GH¢135.6billion. Meanwhile, the E-levy is expected to rake in only GH¢6billion.
Mr. Terkper, in an interview with the B&FT, said considering the deficit gap and how much the E-levy is expected to bring in, introducting the tax would just be a distortion. Therefore, the broader issue should focus on how the huge deficit gap can be closed.
“The issue should be how we are going to finance the deficit. The GH¢6billion from the E-levy is a drop in the ocean because we are looking at financing GH¢37billion. So, inasmuch as the E-levy debate is on, government should answer the bigger question about how – without going to the market – it will finance the last quarter.
“The E-levy is not going to significantly reduce the deficit; it is only going to cause distortion. It is going to cause a burden to businesses and consumers in terms of increment in prices and inflation,” he said.
He further expressed concern about the back and forth between the minority and majority groups in Parliament regarding the budget approval; saying the situation may escalate into a government shut-down if both sides of the House do not come to a quick conclusion in the matter.
“The time to pass the 2022 Budget – December 31, 2021 – is approaching fast and could make a government shutdown a reality; and Cabinet and Parliament must work expeditiously on a strategy or plan of action for revenue, expenditure, borrowing/loan and real sector initiatives.
“A stalemate in Parliament on economic policy continues, the clock is ticking on detailed consideration of the estimates and policies of sector ministries – and poses major fiscal risks of non-passage of budget and closure of government for lack of authority to disburse Consolidated Fund inflows,” he said.
The E-levy debate
reviously, the minority in Parliament held the position that the E-levy would take the country backward by affecting small businesses and individuals, especially the poor. This led to some controversies in the House, leading to rejection of the budget on Friday, November 26, 2021 after the majority in Parliament walked out. But on Tuesday, November 30, the decision was revoked by the majority in Parliament after the minority also walked out.
However, the Minority Leader, Haruna Iddrisu, has departed from his side’s original stance to reject introduction of the Electronic Levy (E-levy) in its entirety – saying they will agree if it is slashed to 1 percent with a threshold of GH¢300.
The Minority Leader said this was arrived at after extensively engaging Finance Minister Ken Ofori-Atta on the matter. He said this at the Ghana Chamber of Telecommunications’ 10th-anniversary launch.
“A week ago, it was no, no, no [that] we won’t accept E-levy. But having listened to officials in government, including the minister for finance, I was convinced to accept a departure from my original ‘no’ to accepting a 1 percent E-levy for the good of the Ghanaian people.
“If government is able to make overtures and reach out and say ‘we want to peg the electronic levy at 1 percent’, I don’t have any difficulty convincing my constituencies. This should be our contribution to fiscal consolidation and our contribution to ensuring that the economy doesn’t collapse on any of us going into the future,” he said.
Source: ghanaweb.com
Ghana’s gold and minerals sector is set for a major spotlight as Meetings. Co, in partnership with key industry stakeholders, announces the Mining & Minerals Convention 2025, scheduled from August 26-27, 2025, at the Kempinski Hotel Gold Coast City, Accra.
Held under the theme “Shaping the Future of Ghana’s Gold Industry,”‘ the Convention will convene government leaders, regulators, miners, refiners, investors, sustainability partners, innovators, and responsible mining, and global competitiveness,policy experts to explore strategies that position Ghana’s gold industry for long-term growth.
The two-day convention will feature presidential and ministerial keynote addresses, industry thought leadership, technical paper presentations, policy dialogues, fireside chats, exhibitions, and high-level networking sessions.
Convention delegates can anticipate a dynamic and insightful experience, marked by thought leadership from leading policymakers and regulators, in-depth discussions on key topics such as sustainability, ESG, digital gold, and responsible sourcing, as well as valuable opportunities to forge public-private partnerships and investment deals.
Moreover, the event will offer practical action points aimed at unlocking greater economic value for Ghana.
The 2025 edition will be supported by a strong coalition of strategic partners, including the Ministry of Lands and Natural Resources, the Minerals Commission, GoldBod, the Minerals Income and Investment Fund (MIIF), and the Ghana Extractive Industries Transparency Initiative (GHEITI).
The Minister for Finance Hon. Cassiel Ato Forson has disclosed that a sum of nine hundred and Eighty-Seven Million, Nine Hundred and Sixty-Five thousand and Seventy-Three Ghana Cedis (GHS987,965,073.00) from the Consolidated Fund into the District Assembly Common Fund Account, being the first quarter amount due to the DACF.
Furthermore, the Finance Minister informed the House that a total amount of Two Billion, Thirty- Three Million, Four Hundred and Sixty-Nine Thousand, Six Hundred and Seven Ghana Cedis (GHS2,033,469,607) has been disbursed to the National Health Insurance Fund.
While the Ghana Education Trust Fund has also received a total of Two Billion, Seven and Ten Million, Two Hundred and Twenty-Seven Ghana Cedis (GHS2,710,227,947.00) for the months January, February, March and April,2025.
The Finance Minister disclosed this in his statement to Parliament on the payments to statutory funds on the floor of the House.
In addition, he cautioned that the Administrator of the District Assembly Common Fund is required to ensure that 80% of this amount is transferred directly to the Assemblies without fail and expenditure returns submitted to the Ministry of Finance before subsequent releases will be made.
He added that Members are encouraged to monitor the utilization of these amounts sent to their respective Assemblies in line with the approved guidelines by Cabinet.
In his closing remark, Ato Forson said he’s going to take the concerns of the House seriously.
For his part, the Majority Leader, Mahama Ayariga made known the President’s prioritization of women in the country stating that President Mahama is “Pro-women”.
This is due to the fact that women are going to be the core beneficiaries from the expenditures going to be made by the MMDA’s, he added.
The Minority Leader Alexander Afenyo-Markin questioned the Finance Minister why road contractors have not been paid for more than five months. He said the Minister must not be applauded for since the allocation of these funds were long overdue.
