Tano North MP, Dr Gideon Boako, has likened the government’s implementation of VAT on foreign digital services to a return of the Electronic Transfer Levy (E-Levy), arguing that the new policy could impose additional costs on Ghanaians who use mobile money to pay for online services.
In a write-up on Friday, October 16, Dr Boako said the application of the 20% VAT to qualifying digital services could affect payments made through mobile money platforms such as MTN MoMo, Telecel Cash and AT Money, as well as bank cards.
He argued that young entrepreneurs and small businesses that pay to promote products on Facebook, Instagram and TikTok, or subscribe to services such as Canva Pro and CapCut Pro, could face higher operating costs.
According to him, these users are not necessarily paying for entertainment but investing in digital tools and advertising to attract customers and sustain their businesses.
“The lady boosting her business on Facebook with MoMo is not Netflix. She is not watching movies. She is trying to survive without a government job,” he wrote, questioning why such business-related expenditure should attract the same VAT rate as entertainment subscriptions.
Dr Boako described the policy as “E-levy Pro Max”, arguing that Ghanaians could end up paying more for transactions involving foreign digital services even after the government abolished the E-Levy.
He questioned whether the new arrangement adequately distinguished between ordinary money transfers and payments for taxable services.
He also challenged the GRA to explain how consumers would be protected against double taxation and how refunds would be handled where VAT was wrongly charged.
Dr Boako maintained that the government should acknowledge the additional financial burden the policy could place on consumers and businesses rather than presenting it solely as an administrative measure to collect an existing tax.
