Abolishment of E-Levy, other taxes: Experts suggest widening of tax net

Economic experts have urged the government to adopt viable strategies to widen the tax net to enhance revenue generation.

They also called for prudent and reasonable public expenditure to ensure that the accrued funds and revenues are not misused.

The recommendations follow President John Dramani Mahama’s assent to Bills repealing the Electronic Transfer Levy (E-levy), Betting Tax and the Emissions Levy.

Mr Jeffrey Kabutey Ocansey, the Executive Director of Revenue Mobilisation Africa, speaking on an Accra-based television programme on Saturday, called on the government to prioritise investment in critical sectors such as agriculture, beginning with mitigating the damage caused to farmlands by illegal mining activities.

He encouraged a targeted focus on the night economy and the informal sector -areas he described as having the lowest levels of tax contribution.

Mr Ocansey recommended the development of a strategic industrial path by investing in skills training to boost local production and create employment.

As part of its broader tax reform agenda, the government is introducing measures aimed at increasing disposable incomes and reducing the overall tax burden on citizens.

The removal of the E-levy is expected to lead to greater disposable income for individuals and households, stimulate digital transactions, encourage financial innovation, and reduce the cost of doing business.

Additionally, the repeal is anticipated to enhance consumer spending and energise economic activity across various sectors, while providing financial relief to companies previously affected by the levy.

Regarding the Income Tax (Amendment) Bill, 2025, the removal of certain withholding taxes is to provide additional income for affected individuals.

The withdrawal of the withholding tax on the purchase of unprocessed gold, in particular, is projected to help curb smuggling and ensure that Ghana derives optimal benefit from its mineral resources.

Mr Wonder Madilo, a Development Consultant, addressed the potential impact of US President Donald Trump’s 10 per cent tariff on exports from Ghana and other countries.

He described it as a wake-up call for Ghana to develop home-grown solutions and eliminate unnecessary public spending.

Mr Madilo urged the government to remain steadfast in pursuing policies that prioritised economic growth and the well-being of citizens.

Mr Yaw Sompah, a Finance Analyst, cited data from the Ghana Statistical Service, which indicated that 92 per cent of businesses in the country operated within the informal sector, posing a significant challenge to effective tax collection.

He urged the leadership of the Ghana Revenue Authority to introduce innovative strategies that could boost revenue in the wake of the E-levy repeal.

Mr Sompah, also a Private Legal Practitioner, called for the formalisation of the informal sector through the identification and categorisation of all groups within.

He recommended the licensing and registration of those groups to allow for proper regulation and monitoring.

The finance expert suggested incentivising the registration process to encourage voluntary compliance with tax obligations.

He highlighted the need for government to ensure strict adherence to tax laws to prevent evasion by multinational companies.

Source: GNA

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