The Director of Research at the Institute of Economic Affairs (IEA), Dr. John Kwakye, has called on the National Democratic Congress (NDC) administration to eliminate what he describes as nuisance taxes in its first budget to provide relief to businesses and individuals.
Speaking on The Big Issue on Channel One TV on Saturday, February 8, Dr. Kwakye strongly criticised a range of taxes, including the Electronic Transfer Levy (E-Levy), the Emissions Levy, the Covid-19 Health Recovery Levy, and the Growth and Sustainability Levy.
He argued that these levies defy sound economic principles and place undue burdens on the populace and businesses, thereby hampering economic growth.
“As an economist, I don’t believe that these taxes should have been there in the first place. Taxes are levied on incomes, transactions, and assets and not on transfers. Some of us said that the E-levy was a nuisance tax and so it should go. The emission and the sanitation should also go.”
The Electronic Transfer Levy was introduced in 2022, and imposes charges on electronic financial transactions, including mobile money transfers and bank-to-bank transactions.
Critics argue that the levy has discouraged digital payments and financial inclusion, which are crucial for modern economic growth.
Beyond these taxes and levies, Dr. Kwakye noted that the overall tax burden on Ghanaians remains high, with businesses and consumers facing multiple levies that erode disposable income and reduce investment opportunities.
He urged the NDC administration to prioritise tax efficiency and introduce policies that support economic productivity rather than overburdening taxpayers.
“The COVID-19 tax is also outdated and obsolete and then there is a tax called growth and sustainability tax which some companies still pay since 2001.”
Covid-19 Health Recovery Levy was originally introduced to help the government recover from pandemic-related expenses but still continues to be in effect despite the global pandemic easing.
Economists argue that it has outlived its purpose and should be scrapped to reduce the financial burden on businesses and consumers.
