In a move that is expected to have a significant impact on Ghana’s digital economy, the Ghana Revenue Authority (GRA) has officially abolished the controversial 1% Electronic Transfer Levy (E-Levy), effective from midnight on April 2, 2025.
The decision comes after President John Mahama’s recent assent to the Electronic Transfer Levy Act, 2022 (Act 1075), along with its Amendment Act, 2022 (Act 1089), which led to the immediate cessation of the levy.
The E-Levy, introduced in 2022, was met with widespread backlash from Ghanaians, including business owners and mobile money operators, who decried the additional financial burden it placed on digital transactions.
Its implementation was seen as a hindrance to the growth of mobile money services, which had gained significant traction in the country in previous years.
The levy, which charged a 1% fee on electronic transfers such as mobile money, bank transfers, and remittances, sparked protests and debates over its impact on financial inclusion and the ease of doing business.
As part of the official announcement, the GRA instructed all financial institutions and payment platforms to immediately stop applying the levy to transactions.
The Commissioner of the Domestic Tax Revenue Division, Edward Apenteng Gyamerah, emphasized that the new directive also requires that institutions swiftly process refunds for any deductions made after the abolition date.
The GRA has set out clear expectations for the institutions involved, mandating that they reconfigure their systems to reflect a “no charge” status on transactions from April 2, 2025.
The Ghana Revenue Authority has taken measures to ensure full compliance with the new order, warning that entities that fail to adhere to the abolition or do not process refunds promptly will face sanctions.
The GRA has also stated that it will conduct regular checks on financial institutions and payment platforms to verify their compliance with the directive.
Non-compliance will result in legal actions and penalties, as stipulated under Ghana’s tax laws.
In addition to stopping the levy, financial institutions and mobile money operators have been instructed to refund all E-Levy deductions made from customers beyond April 2.
The GRA has called for an expedited refund process, with institutions required to maintain thorough documentation of all refunds.
Moreover, charging entities are mandated to submit detailed reports to the GRA about the refunds they process.
The GRA also clarified that any outstanding E-Levy collected before the abolition date must still be reported and remitted to the tax authorities.
The abolition of the E-Levy is expected to provide a boost to the digital economy, which had been significantly affected by the levy’s imposition.
Economic analysts suggest that the removal of the charge will encourage greater financial inclusion and facilitate the growth of mobile money transactions and other forms of electronic payments.
Mobile money, which has become an integral part of Ghana’s financial landscape, is now poised for a resurgence following the government’s decision to remove the burden.
Before the introduction of the E-Levy, mobile money transactions had soared in Ghana, driven by the ease and accessibility of digital payments.
However, the 2022 implementation of the E-Levy dampened growth in the sector, with many users and operators claiming that the tax deterred people from using mobile money services.
The government’s decision to remove the levy comes as part of an effort to revive the sector and stimulate economic activity, particularly in the areas of digital finance and online commerce.
The GRA has also noted that financial institutions must maintain electronic transfer records for a period of six years, in line with the Revenue Administration Act, 2016 (Act 915), which mandates the preservation of such documents.
This is in place to ensure transparency and accountability for the period during which the levy was applied.
-BY Daniel Bampoe
