Adnan Adams Mohammed
Telecommunication Operators in Ghana have been directed by the Ghana Revenue Authority to cease collection of the Electronic Transfer Levy (E-Levy) effective April 2, 2025.
This comes as President John Dramani Mahama assented to the Electronic Transfer Levy Act, 2022 (Act 1075) and the Electronic Transfer Levy (Amendment) Act, 2022 (Act 1089) bill, which abolishes the 1% E-levy.
However, MTN Ghana, a major player in the industry, initially claimed that it could not stop the E-Levy collection for fear of breaching Bank of Ghana’s regulations explaining, the process must go through regulatory approval. Although, it has since stopped charging the levy having received the requisite regulatory directive and has made the necessary refunds in line with the demands of the Ghana Revenue Authority.
“There is a process that has to be followed. I can’t abolish E-Levy until I’m told to do it. If I do it ahead of time, the Bank of Ghana will catch me,” the CEO, Stephen Blewett said while speaking at MTN House in Accra, on Wednesday, April 2, last week. He emphasized that while the government had signaled its intention to remove the levy, telecom operators like MTN must follow official directives before making changes.
More importantly, Blewett also highlighted the negative impact of the E-Levy on mobile money transactions and expressed optimism that its removal would revitalize the sector.
“The reason for the abolishment of E-Levy is to encourage momentum in mobile money,” he explained.
He acknowledged that the tax removal is expected to boost digital transactions and financial inclusion.
“We will follow the process. And once it’s gone, mobile money will regain its strength.”
The E-Levy, initially introduced at 1.75% before being reduced to 1%, taxed electronic transactions, including mobile money payments, bank transfers, and inward remittances. Since its introduction in 2022, it has faced widespread criticism, with opponents arguing that it imposed an additional financial burden on citizens and discouraged digital transactions.
GRA, in it directive communicated the following guidelines, thus:
1. The GRA Electronic Transfer Levy Management and Assurance System (ELMAS) will automatically return a “no charge” on all transactions posted to it by entities from midnight.
2. Charging Entities must cease applying the 1% E-Levy from midnight on all their channels.
3. Charging Entities must immediately process refunds for any E-Levy amounts deducted from customers effective today, 2nd April 2025. Entities are to establish an expedited refund process to handle such cases promptly and maintain proper documentation of all refunds processed. Reports of such refunds must be submitted to GRA.
4. Charging Entities are to take the necessary steps to file and pay all outstanding E- Levy charged and collected on all transactions that occurred before 2nd April 2025.
5. For effective reconciliation and in accordance with Section 33A of the Revenue Administration Act, 2016 (Act 915) as amended, entities must continue to post all electronic transfer transactions to ELMAS until further directives are provided.
6. All entities must maintain electronic transfer records for at least six (6) years as stipulated in Section 27(3) of the Revenue Administration Act, 2016 (Act 915).
“Please be informed that failure to comply with the above directives constitutes an offence and sanctions will be imposed as prescribed by law,” GRA admonished, cautioning it “will conduct regular compliance checks to ensure adherence to these directives”, the statement signed by Edward Apenteng Gyamerah, Commissioner, Domestic Tax Revenue Division (GRA), noted.
Consequently, the Association of Ghana Industries (AGI) has welcomed the removal of the 1% E-Levy, stating that it will boost digital financial transactions and reduce the cost of doing business in Ghana.Ghanaian fashion
The CEO of AGI, Seth Twum Akwaboah, commended the government for its decision, highlighting its positive impact on businesses, especially small and medium enterprises (SMEs).
Seventy-five percent of our members are SMEs, and for them, digital transactions are essential. Any additional cost discourages their use. The removal of the levy will not only cut costs but also encourage more businesses to embrace digital financial services and electronic money transfers.
“It’s a commitment the President made, and now that it has been fulfilled, we look forward to seeing its impact on business growth”, the CEO of AGI said.
Also, Ing. Dr. Kenneth Ashigbey, CEO of the Ghana Chamber of Telecommunications, stressed the broader economic benefits of eliminating the E-Levy.
“With this removal, we expect an increase in both the volume and value of digital transactions. This growth will boost profitability for financial institutions, leading to higher corporate tax revenues for the government, “he noted.
He added: “Additionally, more digital transactions will reduce the cost of printing physical currency, benefiting the Bank of Ghana. It will also generate valuable data for policymakers to enhance fiscal and monetary strategies,”
Ing. Dr. Ashigbey also noted that the removal of the E-Levy aligns with the government’s financial inclusion strategy, fostering a more digitized economy while easing financial burdens on businesses and consumers alike.
