According to him, while the government implements the e-levy as a home-grown revenue measure, they thought it prudent to run to the IMF to help address the pressing economic challenges for the time being.
E-levy hasn’t failed; going to IMF is just for interim relief – Oppong Nkrumah
Information Minister, Kojo Oppong Nkrumah, has rejected calls for the e-levy to be scrapped because it has failed to yield the needed revenue, for which reason the government is seeking a bailout from the International Monetary Fund (IMF).
The government had maintained that the tax was going to raise funds to address the country’s economic challenges, so there would be no need to go to the IMF in the first place.
"Whenever you introduce a revenue measure, it takes a while for it to hit its optimal level. Moreso, the E-Levy has had some loopholes that have to be plugged out by the GRA. The Levy has been heavily bastardised, and so people try to avoid it, and so we are unable to get the full value of what we are looking for. We will have to give it room to reach its optimal level. While at it, we cannot wait for it to reach that maximum level because we have obligations to meet," Oppong Nkrumah said in an interview with Bernard Avle on Accra-based Citi FM on Monday, July 4.
Explaining why the e-levy has not met the government’s expectations in terms of raising revenue to resolve the country’s economic challenges, the Ofoase-Ayirebi lawmaker blamed the stiff opposition that greeted the introduction of the tax that many analysts describe as regressive.
He maintained that, just like other revenue measures, with time, the e-levy will generate the needed revenue.
"Why did we intensify townhall meetings in the first place? Because four months after this was proposed, it was still hanging because of some of the scenarios that were happening in Parliament. In this country, we put fiscal policies before Parliament by November, we expect them to be passed by November or December. This makes it pick up and reach optimal levels by the first quarter of the next year. We put the E-Levy before Parliament in November, it took about 4 months for it to be passed, and then we still have the loopholes that we projected to be fixed by the 1st of July," Oppong Nkrumah said.
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