The Finance Minister, Dr. Cassiel Ato-Forson, has announced the scrapping of the Electronic Transfer Levy, popularly known as E-Levy.
He announced this in Parliament on Tuesday, March 11, during the presentation of the 2025 Budget in Parliament.
“We will abolish the Electronic Transfer Levy (e-levy) of one percent,” Dr. Ato Forson announced.
He said the removal of the e-levy and other taxes, including the betting tax, will ease the burden on households and improve the incomes of Ghanaians.
“The removal of these taxes will ease the burden on households and improve their disposable incomes. In addition, it will support business growth and tax compliance.”
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The Finance Minister explained that the government has also reduced the current tax refund ceiling from six percent to four percent of total revenue as defined in the Revenue Administration Act, Act 915.
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This, he noted, will save the taxpayer GHS3.8 billion, an amount he added was in excess of the revenue shortfall as a result of the removal of the taxes.
“The tax refund account has been abused in recent years. In the last eight years, a study revealed that GHS29.1 billion had accrued to the tax refund account with only GHS12.5 billion, representing 43 percent of the total accrued amount being used for tax refund purposes. The study also revealed that GHS16.6 billion, representing 57 percent of the total amount accumulated in the tax refund account, was misapplied. Mr. Speaker, which is a total violation of the Revenue Administration Act, Act 915, and the Public Financial Management Act. Instructively, Mr Speaker, there were virtually no tax refund arrests over the period.” Dr. Ato Forson explained.
He added that “Mr Speaker, and therefore, we are reducing the current tax refund ceiling by 2 percentage points from 6 percent to 4 percent of total revenue as defined in Section 69 of the Revenue Administration Act, Act 915. Mr Speaker, by reducing the ceiling on the tax refund from 6 percent to 4 percent, we have saved the taxpayer GHS3.8 billion. Mr. Speaker, this amount is enough to close the revenue shortfalls from the removal of the e-levy and the betting levy. Mr Speaker, the e-levy would have accrued GHS1.9 billion, and the betting tax would have accrued GHS180 million. The two put together are just above GHS2 billion. By reducing the tax refund account from 6 to 4, it is enough to remove these taxes, and the savings will be provided to take care of social interventions.”