The Electronic Levy (E-Levy) bill has been passed and is currently in operation. Here are some Frequently Asked Questions (FAQs) about the E-Levy.
This FAQs consist of Questions and answers on the Electronic Transactions Levy (e-Levy) which seeks to clarify certain details in the heads of many who might find it difficult to understand some details related to the newly implemented tax.
The Parliament of Ghana passed the Electronic Levy bill, often known as the E-levy, on March 29th, 2022. With this, Electronic transactions such as mobile money transfers, bank to bank transfers, bank to mobile money transfers, and online payment transactions with payment platforms such as Visa Card, Master Card, and PayPal, among others, are subject to a 1.5 percent tax reduction. Check How To Avoid Paying E Levy Charges in Ghana.
E-Levy Frequently Asked Questions (FAQs)
1. What is the E-Levy?
- The E-levy is a tax on electronic transfers charged during the time of transfer.
- The E-Levy is a Levy on all electronic transfers of money apart from those excluded by law.
- The law is administered by the Ghana Revenue Authority (GRA) and collected through licensed Banks, Specialized Deposit-Taking Institutions, Payment Service Providers (PSPs), and Electronic Money Issuers (EMIs).
2. What is the rate or charge of the levy?
- The rate for the E-Levy is 1.50% of the value of the electronic transfer.
- As well, there are exemptions and those exemptions are provided below.
3. Why has Government decided to levy electronic transfers?
- To enhance domestic tax mobilisation and expand the tax base.
- To provide an opportunity for everyone to contribute towards national development.
4. What will the revenue generated by the E-Levy be used for?
The proceeds shall be used to tackle:
- The seemingly intractable and hydra headed challenges of high youth unemployment;
- Inadequate and poor physical and digital infrastructure, including, in particular, roads;
- Rising public debt; and the
- Diminishing entrepreneurship
culture of Ghanaians.
5. Who is responsible for charging the E-Levy?
The entities responsible for charging the Levy are;
- Mobile Money providers like MTN Momo, Vodafone Cash, AirtelTigo Money, Zeepay, GCB G-Money and Yup Ghana, etc.
- Payment Service Providers (PSPs). They include eTranzact, JuniPay, Korba, Nsano etc.
- Banks like Consolidated Bank Ghana (CBG), Agricultural Development Bank (ADB), etc.
- Specialized Deposit-Taking Institutions (SDIs) such as rural and community banks and savings and loans companies, finance houses etc.
- Other Financial Institutions prescribed by Regulations.
6. When is the E-Levy Starting in Ghana?
The E-Levy Implementation starts Sunday, 1st May, 2022.
7. When will the E-Levy be charged?
When a person makes a transfer, the charging entity will add the Levy to the transfer amount and charge the person’s wallet or bank account.
8. Who will be collecting the E-Levy?
The Ghana Revenue Authority (GRA) will collect and account for the Levy.
9. How will the levy be applied?
The levy will be applied on the value (amount) of transfer above GHS 100 on a daily basis. That is, after one hundred Ghana Cedis (GHS 100) a day cumulative transfer, the e-levy will be applied. In other words, if the total amount sent in a day is not more than GHS 100, you will not pay E-levy.
10. What transactions fall under the E-Levy?
The following transfers/transactions fall under the E-Levy:
- Mobile money transfers done between wallets on the same electronic money issuer– For example sending money from your MTN Momo wallet to another person’s MTN Momo wallet.
- Transfers from a wallet on one electronic money issuer to a recipient on another electronic money issuer – For example sending money from your Vodafone Cash wallet to another person’s AirtelTigo wallet.
- Transfers from bank accounts to mobile money wallets: For example, Kofi transfers money from his CBG bank account to Ama’s G-Money wallet.
- Transfers from mobile money wallets to bank accounts: For example, Esi transfers money from her Zeepay wallet to Yayra’s bank account.
- Bank transfers on an instant pay digital platform or application which originates from a bank account belonging to an individual: For example, Kwame transferring money from his ADB account using the ADB app to Akua’s National Investment Bank account.
11. What Transactions are covered by the E-Levy?
The following transfers/transactions are excluded from the Levy:
- Cumulative transfer of GHS 100 per day made by the same person using mobile money:Everyone will be able to send up to GHS100 a day without paying the Levy.
- Transfer between accounts owned by the same person: If you are sending money to your own account, you will not be charged the E-Levy provided your bank or mobile money accounts are linked with your Ghana Card PIN. For example, a transfer from Naa’s AirtelTigo wallet to her MTN wallet or from her Fidelity bank account to her Prudential bank account or from her CalBank savings account to her current or investment account will not attract the Levy because Naa has linked all accounts with her Ghana Card.
- Transfers for the payment of taxes, fees, and charges: Any payment of taxes, fees or charges made using the Ghana.gov platform or other designated Government of Ghana payment systems will not attract the Levy.
- Electronic Clearing of Cheques: Clearing of cheques by banks and Specialised Deposit-Taking Institutions such as Savings and Loans companies, etc. will not attract the Levy.
- Specified Merchant Payments: Transfers made through an electronic payment service (mobile money, bank application, FinTech platform, etc.) to a commercial establishment which is registered with the Ghana Revenue Authority for the purposes of Income Tax or Value Added Tax are excluded.
- Transfers among principal, agent, and master-agent accounts: To avoid charging the Levy multiple times, transfers among principal, agent, and master-agent are excluded from the Levy.
You might be interested in:
- How To Avoid Paying E Levy Charges in Ghana
- E Levy Charges On Mobile Money
- Tithes and offerings will not attract E-Levy deductions – Dep. Finance Minister
- Fight breaks out in Ghana Parliament over e-levy voting
12. Are utility and airtime payments subject to the E-Levy?
- No, once the payment is a specialised merchant payment (refer to 8v) or one made through a government designated system (refer to 8iii), the transfer amount will not attract the Levy.
13. Are foreign or inward remittances subject to the Levy?
- No, remittances are excluded from the Levy.
14. Will Point-Of-Sale (POS) transactions attract the E-Levy?
- No, as long as the POS transaction is a payment to a commercial establishment registered with the GRA for income tax or VAT purposes, The Levy will not apply.
15. Will Cash-In and Cash-Out for Mobile Money attract the E-Levy?
- No, both Cash-in and Cash – out are not subject to the E-Levy.
16. If a private school is paying its teachers and casual workers via mobile money, will the E-Levy apply?
- Transfers from the school’s corporate mobile money merchant wallet to teachers and casual workers via mobile money will attract the Levy.
- However, the school is allowed to claim the levy as an allowable expense in its income statement.
17. Will mobile money wallet balances attract the E-Levy?
- No, mobile money wallet balances will not attract the Levy. The Levy applies only when there is an electronic transfer from your mobile money wallet.
18. Will mobile money merchant (agent) account transfers attract the E-Levy?
- No. Transfers among principals, master-agents and agents will not attract the E-Levy.
FAQs on Bank & MoMo Transactions
19. What transactions fall under the E-Levy?
- Transfers done on the same mobile money network to another person
- Transfers from one mobile money network to a recipient on another network
- Transfers from a person’s bank account to another person’s mobile money account
- Transfers from a person’s mobile money account to another person’s bank account
- Bank transfers on a digital platform or application which originate from a bank account belonging to an individual to another person
- Interbank daily cumulative transfer above GHS 20,000
- Transfers to Escrow accounts on Instant Pay
20. What transactions are NOT covered by the E-levy?
- Cumulative transfers of GHS 100 per day made by the same person
- Transfer between accounts owned by the same person (either in same bank or different banks) (if account holder has linked Ghana card)
- Transfers for the payment of taxes, fees, and charges using the Ghana.gov platform or other designated method
- Self intra bank transfers
- Clearing of cheques by the banks and specialized deposit taking institutions
- Specified merchant payments to commercial establishments to a person registered with the Ghana Revenue Authority
- Transfers between principal, agent, and master-agent accounts
- ATM withdrawals
- Cash-in into an individual’s own wallet
- Cash-out from an individual’s own wallet
- Mobile money wallet balances
- Insurance claims will not attract E-Levy
- Loan disbursement from Licenced entity
- Loan repayment to licenced entity
- Transfers to and from gaming accounts
- Transfers to Investment account
21. Will the levy be charged on payments of wages and salaries using mobile money?
- If the company is registered with GRA for income tax or VAT and salary payment is made from a corporate bank account, there will be no E-levy charge on the amount.
22. Will there be a threshold above which E-levy charges will not apply?
- No, there is no threshold.
23. When can I make more Enquiries if I need help ?
You can contact the Ghana Revenue Authority for Assistance at:
24. If I encounter some trouble with Network Providers, who can I call?
- Call the various call canters eg. Call 100 (MTN Call Centre)
- Visit any Telecommunications Network Branch Office for immediate assistance eg. Visit any MTN, Vodafone or AirtelTigo Office
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