The Chamber for Local Governance (ChaLoG) has described as ‘very disingenuous and most unfortunate’ a comment by Finance Minister Ken Ofori-Atta suggesting that the District Assemblies Common Fund (DACF) can only be paid if the e-levy is passed.
Mr Ofori-Atta had reiterated the need for Ghanaians to support moves by the Akufo-Addo-led government to impose a tax on electronic transactions.
Initially proposed to be pegged at 1.75 percent, the government has now reviewed the rate to 1.5 percent but the levy is still facing resistance by a section of the Ghanaian public and the Minority in Parliament.
The government has since been on a tour of the country engaging the public in what has been christened ‘Government Townhall Meeting on E-Levy’ aimed at rallying support for the proposed tax policy.
Speaking in Wa in the Upper West Region during the fourth townhall meeting, Mr. Ofori-Atta said government needs the money to be able to take care of critical government expenditure in addition to building infrastructure and creating jobs.
He said even though the E-Levy may not bring in a lot of money, what would be realized should be enough to support the government.
He added that had the Minority not resisted the policy, government would have started realizing money which would have been used to pay District Assembly Common Fund.
“E-levy as small as you might think, it will be GH¢7 billion, starting this year if we had started early so we could pay your District Assembly Common Fund but your [opposition] sitting on it,” he said.
The Minister observed that majority of the Members of Parliament (MPs) in the 11 constituencies in the Upper West are NDC and that he is not surprised they do not support the e-levy.
“If I look at Upper West where we have 11 constituencies…we have 340,000 people being youth with serious issues of unemployment with eight of our MPs coming from the NDC. What reason will they have to support an e-levy which is looking about GH¢10 billion intervention called YouStart which is looking at getting to the heart of employment,” he said.
“Hate NPP all you want but what about your 340,000 youth who need jobs? What is the reason?” he wondered.
But a statement reacting to this development issued by ChaLoG said, it has “noted with shock and dismay the attempt by government to attribute the delay in releasing the DACF to the non-implementation of the E-Levy Tax, in its quest to convince the generality of Ghanaians to accept the Electronic Transfer Levy (E-Levy).
“ChaLoG finds the purported comments attributable to the Finance Minister to be very disingenuous and most unfortunate as the Total Revenues for the 2021 Financial Year has already been collected and by now should have been released to the Accounts of the Common Fund Administrator for onward Transfer to the Metropolitan/Municipal/District Assemblies (MMDA’s) based on the formula by Parliament.
“For the avoidance of doubt and for the information of the Finance Minister, Article 252 (2) of the 1992 Republican Constitution states: “Subject to this Constitution, Parliament shall annually make provision for the allocation of not less than five percent of the total revenues of Ghana to the District Assemblies for development; and the amount shall be paid into the District Assemblies Common Fund in quarterly installments”
“ChaLoG wishes to remind the Finance Minister that the main and only source of money to be paid to the DACF is five percent (5%) of TOTAL REVENUES collected and not monies collected from any specific tax imposed by the Government.
“It is against this backdrop that ChaLoG wishes to call on the Minister of Finance to immediately retract and apologize to the good people of Ghana for using the non-implementation of the E-Levy as a basis for the delayed release of the DACF to the MMDAs to undertake development projects.”