Ghana Politics

‘District Assembly Common Fund has nothing to do with E-levy’ – Haruna blasts Ofori-Atta

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The Minority Leader, Haruna Iddrisu, has accused the Minister of Finance, Ken Ofori-Atta of peddling falsehood about the disbursement of the District Assembly Common Fund in relation to the controversial Electronic Transaction Levy.

According to him, the Minister’s supposed comment to the effect that the government needs to collect E-levy to be able to meet its statutory fund obligations is not accurate.

Speaking to the media, Haruna Iddrisu indicated that the District Assembly Common Fund is a dedicated pool of funding and has nothing to do with the proposed e-levy.

“The 1992 constitution requires that 5% of the total revenue is dedicated to the District Assembly Common Fund. He is in arrears from 2018 to 2019, 2020 to 2021, yet, he has been collecting revenue. He has not been able to dedicate that 5% as required by the constitution. That is why many Regional Coordinating Councils and District Assemblies have become dysfunctional.”

“They [Local Assemblies] do not have the basic resources to run their affairs. He should stop using the District Assembly Common Fund as a case for the E-levy.”

The government has been widely criticized for portraying the E-levy as the antidote to many of the country’s financial challenges.

Currently, the national conversation has been around the government pushing through the controversial 1.75% electronic transaction levy estimated to rake in some $1 billion annually or going onto an IMF program.

The tax measure was announced by the government in the 2022 Budget on basic transactions related to digital payments and electronic platform transactions.

The rate in the budget was 1.75 percent, but it is expected to be reduced to 1.5 percent. Despite the intended reduction, there is still stiff opposition to its passage.

Some analysts have proposed seeking an IMF bailout as a better alternative amidst public disapproval of the E-levy, but the government has said it will have none of that.

Others have also brushed off calls for the government to go under an IMF programme, insisting that the options left for Ghana to consider are fiscal discipline, a reduction in wasteful expenditure, and the sealing of revenue leakages.

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