Ghana’s Electronic Levy Falls Short of Target, Prompting Revised Projections

ACCRA – The Electronic Levy (E-Levy), introduced by the Government of Ghana to impose taxes on electronic money transfers, failed to meet its target for the first half of 2023, according to data from the Minister of Finance’s 2023 Mid Year Fiscal Review. The E-Levy, which aimed to raise revenue for the government, fell significantly short, raising GHC 455,579,224 out of its projected GHC 982,849,212, representing only 46.35% of its target. As a result, the Ministry of Finance has revised its total target for the year from GHC 2.2 billion to GHC 1.1 billion.

Aiming to Boost Government Revenue

The Government of Ghana implemented the E-Levy as a measure to increase its revenue and support critical sectors of the economy. The levy placed a 1.5% tax on electronic money transfers, including mobile money transactions exceeding 100 GHC. The intention was to generate additional funds for development projects and to address the country’s fiscal challenges.


Adjustment of Levy Rate in Response to Public Concerns

In response to public concerns and feedback, the Ministry of Finance revised the E-Levy last year, reducing the tax rate from 1.5% to 1%. The decision came after significant public debate surrounding the impact of the initial levy rate on consumers and businesses alike. The reduction aimed to strike a balance between revenue generation and ensuring the burden was not overly oppressive on the citizens.

Missed Targets and Revised Projections

Despite the adjustments made to the levy rate, the E-Levy’s performance in the first half of 2023 indicates that it has not yet met expectations. With only 46.35% of the projected target being achieved, the government is now faced with reevaluating its revenue projections and budgetary plans.


Revised Total Target for 2023

In light of the shortfall in revenue, the Ministry of Finance has taken decisive action and recalibrated its total target for the year. The initial goal of GHC 2.2 billion has been revised to GHC 1.1 billion. This revised target reflects the current realities and challenges in achieving the desired revenue levels from the E-Levy.

The Way Forward

The Ministry of Finance and relevant authorities are likely to closely monitor the performance of the E-Levy in the coming months to assess the effectiveness of the revised 1% tax rate. Government officials may also explore other avenues to enhance revenue generation while taking into consideration the concerns of the public and businesses.

As Ghana seeks to address its fiscal obligations and finance essential projects, finding a delicate balance between revenue generation and the welfare of citizens will remain a priority for policymakers. The E-Levy’s performance and the revised projections will be closely watched by the public, businesses, and economic analysts, as the nation strives to navigate through its financial challenges.