National President of the University Teachers Association of Ghana (UTAG), Professor Solomon Nunoo has said the newly introduced Electronic transaction levy would be daunting to Ghanaians.

Speaking on Newsfile on Saturday, Professor Nunoo said the government should have held better consultations before introducing the levy.

“Now if you decide to transfer money to your village, you are now being told you would be taxed 1.75% on it, that is very discouraging for us and we felt there should have been better consultations on some of these things before implementation,” he said.

Finance Minister, Ken Ofori-Atta, during the presentation of the 2022 Budget announced that government intends to introduce an Electronic Transaction Levy (E-Levy) next year.

The proposed levy, which will come into effect after Parliament approves the Budget is a charge of 1.75% of the value of electronic transactions.

The tax has been criticised by many citizens. The Minority in Parliament said they will oppose the levy if it comes to Parliament.

But also on the same show, the CEO of the Ghana Association of Banks, John Awuah, noted that for the start point of taxes on electronic transactions, the levy is expensive.

Mr Awuah explained that although the E-levy initiative is laudable, the government must reduce the 1.75% levy.

He said the levy, however, would capture more Ghanaians into the tax net.

“Even if the government decides to take any action in levying for electronic transactions such as the MoMo, the 1.75% appears to be a start point too high…The rationale behind ensuring that we open a lot more people into the tax collection basket is one that is laudable.

"Tax compliance unfortunately in this part of our world has not been at very good levels. Perhaps the rationale for the levy is well-grounded but the quantum entry, the 1.75% in my view is very high,” he lamented.