E-LEVY:

Date

*HOW DID WE GET HERE?

*WHERE DO WE GO FROM HERE?

* Stage by Stage Analysis (2) 
Story: Richmond Keelson & Atta Kwaku Boadi

Parliament divided over E-Levy: The debate preceding the passage of the E-Levy bill was as predicted, based on entrenched party lines. The majority group supported Finance Minister Ken Ofori-Atta’s position that the introduction of the electronic transaction levy was to “widen the tax net and rope in the informal sector”.

In the estimation of minister Ofori-Atta, since the majority of the population make a living in the informal sector, “it seems a convenient to increase government revenue.”  This was however disputed by the minority caucus. 

Minority’s opposition to E-Levy: The minority, led by leader Haruna Iddrisu, vowed to torpedo the proposed 1.75% tax on all electronic financial transactions. According to the group, such tax regime, in the words of the minority leader was “disincentive to investments and private sector development and will also overburden the average Ghanaian.” 

“Our concern is whether the e-levy itself will not be a disincentive to the growth of a digital economy in our country. We are convinced that the e-levy may as well even be a disincentive to investments and private sector development in our country… We in the Minority will not support government with the introduction of that E-Levy. We are unable to build national consensus on that particular matter,” Haruna Iddrisu noted.

Other industry players, including those within the telecommunications sector also raised concerns about the policy. In its response to the other industry players, Government disclosed that it would engage also, the telecommunications on the policy. That was however not done. Not that was seen within the public glare. 

The drama of E-Levy rejection by Parliament

Central to the rejection by Parliament of government’s 2022 Budget Statement and Economic Policy, was the controversial E-Levy tax regime. All the arguments adduced especially by the minority that culminated to the rejection of the budget statement was centered round the E-Levy. 

When it became obvious that their numerical strength could not match that of the minority during a vote on 2022 budget that had virtually been reduced to a E-Levy debate, the majority staged a walk out and refused to be part of a concluding decision on the Budget— E-Levy statement. That was on Friday, November 26, 2021. 

The majority walk out was necessitated by a disagreement over a voice vote which did not go in their favour. The decision by the majority however, did not deter the House from continuing with the business of the day, which highlight was the rejection of the 2022 E-Levy induced Budget statement.

A last-minute request by the Finance Minister to meet with the leadership of the House was turned down by MPs from the minority side who at the day’s sitting, had majority representation in Parliament than their counterpart in the majority. The minister’s plea was made after the House Speaker, the Rt. Hon. A.S.K Bagbin had announced that the ‘Nos’ had won the voice vote.

Deputy Majority Leader, Alexander Afenyo Markin, would not agree to the Speaker’s interpretation of the voice vote and therefore called for a ‘division’ which the Speaker obliged. Mr. Bagbin therefore directed that all non-MPs in the House vacate the Chamber during the division process. The Speaker however had some strong words for the majority before he made the “division” call.  

“As the Speaker, I will do all I can, not allow the government to obstruct or frustrate parliament in its lawful duty. That is a pledge to the people of Ghana, and there is a reason why the good people of Ghana elected this parliament. It is a hung parliament of 137-137, the independent decided to do business with one side of the majority, so there is no majority party in this house. This is a new beginning, where for the first time, a Majority has walked out from its own business”, Rt. Hon. Alban Bagbin stated.

Before they departed from the House Chamber, the Majority MPs demanded that the General Secretary of the National Democratic Congress (NDC), Johnson Asiedu Nketiah, who was sitting in the public gallery vacate the House. General Mosquito however, ignored the request by the Majority MPs.

Parliament rescinds decision to reject budget

In what became what observers described as parliamentary chess game, the Majority also led a one-sided “bout” to rescind an earlier decision by the minority to reject the 2022 Budget—E-Levy statement on Friday, November 30, 2022. This was done without Minority in the House-Chamber because talks with the Majority leadership on the controversial Budget had broken down.

The Minority boycotted the proceedings because the First Deputy Speaker, Joseph Osei Owusu counted himself as an MP, thus making the Majority Caucus in the House 138 members and therefore offered them with the slimmest of margins at the time to overturn the Minority decision.

MPs brawl in Parliament over E-Levy 

The decision by Joseph Osei-Wusu to vote resulted in an intense brawl among majority and minority MPs during a late-night session over the contentious government-proposed levy on electronic transactions in the 2022 budget. MPs from the two divides pushed, shoved and threw punches at each other. Others tried playing umpires and referees as they tried to ward-off the aggressors. The commotion started when some Minority MPs rushed to prevent First Deputy Speaker Osei-Wusu from leaving his seat to vote. 

Hon Osei-Wusu was chairing the session in the absence of substantive Speaker, the Rt. Hon. Alban Bagbin who had travelled overseas for medical treatment. The disorder brought abrupt adjournment to the proceedings of the day. The NDC contended that as the chairman of the day’s session, Joe Osei-Wusu did not have the locus to vote as any ordinary member of the House therein present.

Ghana’s politics has been fractious since the 2020 election when the two leading parties split parliamentary seats into equal 137— 137 each. The other remaining seat is held by an independent, whose decision to sit with the NPP has given it a marginal majority. Before the Majority move, there were talks for several hours in a desperate attempt to build consensus over the rejected Budget. 

As stated earlier, the entrenched stance of the two divides on the 2022 budget centered round the controversial E-levy and not necessarily, the entirety of the content of the budget statement. The Minority Caucus demanded total withdrawal of the proposed levy while the majority side together with the Finance Minister agreed to reduce the proposed levy from 1.75% to 1.5%.

This was however rejected by the NDC side of the House. Another source of disagreement was the procedure to be adopted for the re-introduction of the 2022 Budget on the floor of the Chamber. The Minority group had preferred a vote of rescission— that’s first to rescind the Majority decision to approve the 2022 Budget, before any such motion to re-consider the 2022 budget.

The drama of Adwoa Safo impersonation

There was however rare drama that preceded the Majority approval of the E-Levy induced Budget. Some members of the public gallery hinted the Minority that someone impersonated Dome-Kwabenya MP, Sarah Adwoa Safo in the course of the voting. That was the time the Minority had walked out of the Chamber in protest against the actions of the First Deputy Majority Leader. 

There was and still unresolved issue of the person who voted in Adwoa Safo’s stead not being the incumbent MP. Adwoa Safowas allegedly in United States when the event of the night occurred in Ghana’s Parliament. Adwoa was said to have given birth in the US and could not arrive on time to take part in the approval process.  

North Tongu MP, Samuel Okudzeto Ablakwa picked up the issue the next day in Parliament, saying that the Minority suspects someone was used by the majority in Parliament to impersonate the Dome-Kwabenya MP. He declared “Following pictures and videos we are reviewing this morning, it is becoming quite apparent to us that there may be a case of impersonation with regards to the lady who was presented as Adwoa Safo. It’s beginning to appear that she may not be Adwoa Safo.”.

The impersonation allegation was however debunked by Sarah Adwoa Safo, the day after the Majority approval of the E-Levy insisting she was the same person in parliament on the night of approval: “As a former deputy Majority Leader of this house, I want to put it on record that I was present in this House yesterday [Tuesday].”

Still unconvinced about the Adwoa Safo explanation, Samuel Okudzeto Ablakwa disclosed that the Minority would continue with its investigations. Speaking to a section of the media, the Nrth Tongu MP said the minority’s findings from preliminary investigations on the issue were disturbing.

“We will continue with the investigations. We are still not convinced that the person who was in parliament yesterday purporting to be Adwoa Safo was indeed Adwoa Safo. We are convinced that the person who came to parliament yesterday was not Sarah Adwoa Safo,” Samuel Okudzeto Ablakwadeclared. Mr. Ablakwa disclosed that the Minority had obtained all the needed footage for investigations and will subject it to scrutiny by using modern technologies. This issue is however still pending. 

Five (5) Issues Minority wants captured in a revised 2022 Budget: 

Aside their protests against the conduct of the First Deputy Speaker, one other reason that necessitated the Minority walk out over the second approval of the 2022 Budget, was the intransigence of the Finance Minister to not to consider some proposals brought by the NDC to be included in the revised 2022 Budget statement. 

The Minority had highlighted some five key issues it wanted captured in the revised 2022 Budget and addressed before it gave it support to the proposed revised Budget. Below is the full statement of the NDC’s five points agenda: 

1. Suspend the Electronic Transaction Levy (E-Levy): The Government should suspend the E-Levy and properly engage stakeholders to agree on a reasonable policy. How can mobile money payments, bank transfers, merchant payments, and inward remittances be charged 1.75 percent? The policy is not retrogressive, not pro-poor, and does not support the much-touted digitalisation agenda and cash-lite economy that we all yearn for. 

2. Withdrawal of Agyapa: The NDC Minority will not support any collateralisation of our revenues, particularly mineral resources. The future of our country will be bleak if we continue in that regard. We cannot jeopardise the future generations of our country just for our present desires.

3. Provide for Tidal Waves Disaster: The Government should incorporate in its revised Budget adequate measures to address the issue relating to the Tidal Waves Disaster in Keta and other communities. The victims should be supported. And the Phase II of the Blekusu Coastal Protection Project must find space in the Budget.

4. Properly re-construct the wording relating to the Aker Energy:  Relating to GNPC acquisition of stake from Aker Energy and AGM Petroleum, the revised Budget should reconstruct paragraph 829 of the rejected Budget to reflect the decision of the House as captured on 6th August 2021 Votes and Proceedings of Parliament.

5. Review the Benchmark Value for Imports: Government should, in a revised Budget, reconsider paragraph 247 of the rejected Budget which sought to restore the Benchmark Values of imports by suspending the 50 percent discount on selected General Goods and the 30 percent discount on vehicles. Some concession should be given to the importers.

Minority rejects 2022 Budget modifications  

After close to some two-hours meeting, the Minority resolved not to accept the proposed amendments done to the 2022 budget by Finance Minister, Ken Ofori-Atta. This is because none of the concerns raised by the Minority in its five-point agenda was captured in the revised Budget. The Minority thus, insisted on its motion of rescission, to overturn the approval of the 2022 budget statement by the Majority.

The Minority insisted that they did not recognize the 2022 budget and stressed that their motion of rescission was not addressed in the modified Budget. The Finance Minister, Ken Ofori-Atta, in an earlier press conference, announced concessions made to the Budget. In his address, it became obvious that the Finance Minister failed to address the concerns raised by the Minority. What irked the Minority group the most,was the reticent posture of government to not withdraw the controversial E-Levy tax, although the charges were reduced from 1.75% to 1.5%.

Govt reduces E-levy from 1.75 to 1.5 percent

After his meeting with the leadership of the Minority, Ken Ofori Atta, the Finance Minister reduced the E-levy rate from the initial 1.75 per cent to 1.5 per cent. That meeting was held on Friday January 28th, 2022. The Minority still retained their opposition to the bill insisted that it’s dropped entirely. 

This meeting was a follow up to an earlier meeting held on January 27 on the same subject. That involved the leadership of the two parties and it ended in a deadlock with each of the parties consummate in their entrenched positions. The meeting, according to the Finance Minister was part of stakeholder engagements on the proposed E-Levy tax.

Majority Leader, Osei Kyei Mensah Bonsu urged all MPs to prioritize the process leading to the passage of the E-levy. He told the House that further stakeholder consultations were ongoing on the proposed Levy. The Suame Lawmaker explained the absence of the E-levy proposal on the Order Paper for the week saying, “Mr. Speaker, as Honourable members will recall the House was expected to conclude consideration and passing of the electronic transfer levy bill 2021 by the end of the third meeting for the first session.

He further explained the delays in the passage of the E-Levy in the following: “Due to unforeseen circumstances however, the House was unable to consider and pass the bill at the end of ofthe meeting. It was therefore the contemplation of the Business Committee that the Bill will be scheduled for consideration by the House during the First week of the first meeting of the second session.

“However upon consultation with the sponsoring Minister the committee is not unable to programme same for this week after resumption. The Honourable Minister of Finance has been undertaking further engagement with stakeholders and sections of the general public with respect of some concerns that have been raised on the bill.

Nonetheless the Minority still held the view that policy proposal was a disincentive to the growth of the Ghanaian digital economy. The Minority Leader, Haruna Iddrisu still insisted that his group would not support it. 

“Mr. Speaker, our concern is whether the e-levy itself is not and will not be a disincentive to the growth of digital economy in our country. We are convinced that the e-levy may as well even be a disincentive to investment and a disincentive to private sector development in our country. We in the minority may not and will not support government with the introduction of that particular e-levy. We are unable to build national consensus on that particular matter,” Haruna said at a workshop on the proposed electronic levy. 

Gov’t holds Town Hall Meetings on E-Levy 

As part of efforts to sensitize Ghanaians that perhaps, the E-Levy was the only avenue of shoring up revenue in the economy, the government on Thursday, January 27, 2022, embarked on town hall meetings on the controversial Electronic Transactions Levy (E-levy). The exercise aimed at explaining the importance of the E-levy as well as take feedback and inputs from relevant stakeholders on the levy.

According to government the feedback would help it make informed decisions on the implementation of the levy. The town hall meetings featured Finance Minister, Ken Ofori-Atta, Minister for Communication and Digitalization, Ursula Owusu-Ekuful, Minister for Information, Kojo Oppong Nkrumah and Deputy Majority Leader, Alexander Afenyo-Markin. Also, in attendance were sector-specific like Civil Society Organisations(CSOs) and other relevant industry stakeholders.

In the words of Finance Minister, Ken Ofori Atta, “government is convinced about the need for the e-levy and how it encapsulates the idea of burden-sharing for Ghana’s development” and therefore declared: “Beginning on Thursday, a team comprising myself, colleague ministers and other key members of government will embark on a public engagement and sensitisation campaign across the country. 

We intend to communicate clearly on the proposed mechanics of the e-levy, its potential benefits to the people of Ghana within the spirit of burden-sharing that must guide us in our development efforts as we move Ghana Beyond Aid,” he said.

For the Third-Time Parliament passes E-LEVY: In a rather unprecedented move in the history of the 4th Republic, aspect of the 2022 Budget was approved after a third call but not without melodrama. Minority Members of Parliament staged a walk-out before the Electronic Transfer-Levy (E-Levy) Bill 2021 was passed on Tuesday (March 29, 2022) afternoon.

The Minority complained bitterly that it was taken by surprise by the consideration of the E-Levy given the fact that it was not listed in Parliament’s business statement for the week. The Bill which was considered under a certificate of urgency was adopted at a reduced rate of 1.5% from the proposed 1.75%. The Minority walked out of Parliament before the second reading of the Bill after debate.

As a result of their actions, proposed amendments in the name of some Minority MPs were removed because none of them was present to move the amendments in their name. The Speaker of Parliament, Alban Bagbin, stated that he was surprised by the walkout of the Minority. He, however, indicated that it would not affect the course of proceedings. 

To be continued on Monday May 16th, 2022.

Leave a Reply

Your email address will not be published.

More
articles