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Monday, August 15, 2022

E-Levy won’t be terminated because of IMF bailout – Gov’t assures – Citi Business News

As government commences its in-person meetings with the delegation from the International Monetary Fund (IMF) team, led by Mission Chief for Ghana, Carlo Sdralevich, starting, Wednesday July 6, 2022, it is assuring that the controversial Electronic Transfer Levy (E-Levy) will not be terminated.

According to the IMF, it stands ready to assist Ghana to restore macroeconomic stability, safeguard debt sustainability, and promote inclusive and sustainable growth, and address the impact of the war in Ukraine and the lingering pandemic.

However not all persons are enthused with the Government’s decision to seek the assistance of the Bretton Woods institution for balance of payment support.

Labour unions including the Trades Union Congress (TUC) for example believe, resorting to the IMF means the economy will likely reel under several restrictions and controls to be imposed by the fund.

In a recent document sighted by Citi Business News titled ‘’Frequently Asked Questions as Government Engages the IMF for a possible funded programme’, the Finance Ministry assured that government will not terminate the E-levy simply because the IMF will give Ghana money.

According to the Ministry, Government is committed to ensuring the smooth operationalization of all taxes including the E-levy to ensure that in addition to the IMF’s resources, government can continue to support its developmental goals on its own while ensuring that tax-to-GPD ratio increases to the peer range of 16%-18%.

It added that an IMF-supported programme is likely to encourage the government to investigate the factors hindering the success of the e-levy (including by providing technical assistance if needed) and come out with strategies to improve it.

On how long it will take for the negotiations between Ghana and the IMF to be concluded, the document from the Finance Ministry noted that even though programme negotiations can be quick or be protracted for up to 6 months or more, Government stands ready to quicken and shorten the negotiation process by sharing relevant data as well as presenting its enhanced economic programme that will anchor the supported programme.

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