June 2nd, 2022 at 06:37 am
5 countries that charge e-levy
E-levy is also known as Electronic Transaction Levy is a tax that is imposed on transactions made on digital platforms.
BENEFITS OF CHARGING E LEVY
Some of the benefits of charging e levy include:
- A prompt acknowledgment of your tax has been paid
- Also, it has better accuracy as errors will be minimized as compared to errors made by humans when entering the data.
- It offers you convenience as you don’t have to move about to pay your tax.
- Last but not least, you get prompt notification of your filing once a transaction is complete.
COUNTRIES THAT CHARGE E LEVY
1 . GHANA
On Tuesday, 29th March 2022, Ghana’s parliament approved the Electronic Transfer Bill(E-levy)2021 under a certificate of urgency. The e-levy bill will accrue a revenue of GHC 6.9 billion to augment the government’s revenue.
The bill imposes a 1.5 percent on electronic money transfers. The revenue accrued from the e-levy will support some of the government’s initiatives such as; providing employment to the youth, entrepreneurship, and construction and maintenance of roads among many others.
The transactions that are being taxed include:
- Mobile Money Transfers between accounts on the same Electronic Money Issuer (EMI)
- Mobile Money transfers from an account on one EMI to a recipient on another EMI
- Transfers from bank accounts to mobile money accounts
- Bank transfers on a digital platform or application originate from a bank account belonging to an individual, to another individual.
2 . UK
The UK calls it e levy the Digital Service Tax. It is a tax that is imposed on businesses that offer social media services, search engines, or an online marketplace to UK users. These businesses will pay a 2% tax on their revenue if they earn is more than £500 million and more than £25 million from users in the UK.
Nonetheless, there are some exemptions to this tax, some of them include; Where one of the parties to a transaction on an online marketplace is a UK user, all of the revenues from that particular transaction will be treated as derived from UK users. The digital service tax is paid on an annual basis.
3 . NIGERIA
The Nigerian government introduced the electronic tax system to increase the revenue generated by the country thereby increasing the country’s economic growth.
4 . ZIMBABWE
In 2019, Zimbabwe imposed a 2% intermediated money transfer tax (IMTT). The IMTT applies to mobile money, electronic, and bank transfer transactions and this has accounted for all the corporate taxes received by the government.
5 . UGANDA
In 2018, Uganda introduced taxation on its mobile money and that led many to migrate to the banks.
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