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Scrap e-levy; introduce vehicle tax – Prof. Ebo Turkson

Assoiate Professor for Development Economics at the University of Ghana, Professor Ebo Turkson, has called on the government to scrap the e-levy immediately.

According to him, he was surprised the levy even made it into the Finance Minister’s Mid-Year Budget Review.

Speaking on JoyNews’ PM Express, he stated that he has two reasons for the scrapping of the taxes. These include, the need for telecommunication companies to grow their profit, and the second is to reintroduce old tax regimes that had great potential.

He said, “The telcos when they have a drop in the number of consumers that use the e-levy, it has implications for their profitability. And if you take profit from them, corporate taxes on their profits, that will mean that government is even going to get less taxes from the telcos.

“We should rather support the telcos and Ghanaians to make more use of the digital technology and then the telcos the services that they offer, let the telcos do very well, make more profits and then we tax the profits. We shouldn’t discourage people from using their services because they provide a lot of resources for our economy as well.”

His second point was that a vehicle tax should be introduced.

This tax, similar to the scrapped luxury vehicle tax, should not just target the wealthy class but everyone with a car in general.

According to him, the luxury vehicle tax failed because rich people who the tax directly affected were able to convince their friends in government to scrap it.

He explained that when the tax affects everybody, the resistance to the tax will not be as strong.

“How many cars do we have in Ghana? Let’s take a figure of 5 million cars. If every year, every car is paying 400 cedis as part of the roadworthy… If you don’t pay you do not have road worthy. It was because it was only a class of people who were paying those taxes, who were influential who got that tax to be removed.

“That shouldn’t have been removed. If we’re removing the road tolls and we need money to fund our road infrastructure every car in this country in a year when it goes for its road worthy should pay.”

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