What is the E-Levy?

The Electronic Levy (E-Levy) is a tax introduced by the Government of Ghana that applies to electronic transactions. It is designed to increase revenue generation by taxing digital financial activities, including mobile money, bank transfers, and merchant payments.

Key Details of the E-Levy

  • Effective Date: May 1, 2022
  • Rate: 1% of the value of electronic transfers
  • Threshold: Transactions up to GHS 100 per day are exempt (for individuals)
  • Applies To: Mobile money transfers, bank transfers, inward remittances, and merchant payments
  • Exemptions: Transfers between your own accounts (same name), and transactions below the GHS 100 daily threshold

Which Transactions Attract E-Levy?

The E-Levy applies to:

  • Mobile money transfers between individuals
  • Transfers from bank to mobile money and vice versa
  • Payments to merchants using mobile money
  • Online payments and digital wallets

Who Pays the E-Levy?

The sender of the funds is typically responsible for paying the E-Levy. For example, if you send GHS 200 via mobile money, 1% (GHS 2) will be deducted as tax.

Why Was the E-Levy Introduced?

The government introduced the E-Levy to:

  • Broaden the tax net
  • Generate revenue for infrastructure and development
  • Promote a cash-lite economy

Controversies and Public Reactions

The E-Levy has been controversial, with many Ghanaians expressing concerns about increased financial burdens and the effect on mobile money usage. Some argue it affects low-income earners and discourages digital transactions.

Conclusion

Understanding the E-Levy is important for everyone who uses mobile money or online banking in Ghana. While it helps government revenue, it's also essential to consider how it affects everyday financial activities.

Stay informed and check with your service provider for how the E-Levy is applied to your transactions.

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