Direct taxes on individuals is distressing – Konadu Apraku
A former Minister of Trade and Industry, Dr Konadu Apraku, has cautioned against the implementation of the Electronic Transfer Levy (e-levy), saying it can affect the fortunes of the New Patriotic Party (NPP) in future elections.
He stated that direct taxes on individuals is distressing and can be destructive if not handled prudently because the basic economic principle behooves the government to direct businesses to generate resources.
“The government should tax businesses to generate resources but individuals’ direct taxes such as the e-levy can sometimes be distressing and destructive since it is basic economic principle the lesser you tax business and the government reduces its expenditure the better off it is for the nation,” he noted.
He indicated that it was business that could carry the government and higher taxes are not desirable as an economic standard and the lower the taxes the greater the prospects for progress, growth and development adding that “we are politicians, in the final analysis, the people are the ones who will give their verdict, if it is as bad as they think it is and the government insists on it, they must be prepared to pay a big price.
“Whatever be the case, the government must expand the tax net for bigger companies because they are the ones that are powerful and evade taxes, the medium and small ones need protection and the greater burden ought to be borne by the private sector,” Mr Apraku observed.
The government will from May 1, 2022 charge a 1.50 per cent rate on electronic transactions that are more than GH¢100 on a daily basis however, critics of the proposal have warned that the levy will negatively impact the Fintech space, as well as hurt low income earners and those outside the formal banking sector.
The e-levy has been source of tension in Parliament since it was introduced in the 2022 Budget Statement and Economic Policy and tensions culminated in a scuffle between the Legislative in Parliament in December 2021.
The government has contended the levy will widen the tax net and can increase revenue generation by an estimated GH¢6.9 billion in 2022 and there are also concerns the government may securitise proceeds from the levy to raise extra revenue.
Source:myjoyonline
