E-Levy case: File statement of case within 14 days – SC orders A-G
The Supreme Court (SC) has ordered the Attorney-General to file its statement of case in the suit challenging the passage of the Electronic Transactions Levy (E-Levy).
The Attorney-General’s Office has been given 14 days to ensure all processes are filed and served on the other parties.
It will be recalled that three minority members of parliament filed a suit against the passage of the E-Levy, which took effect on 1 May.
The 14-day extension comes after the apex court granted a motion for the request for more time to file processes submitted by the A-G’s office.
When the case was called on Thursday, 26 May 2022, a Principal State Attorney representing the Attorney General, Cynthia Quartey, urged the court to extend the time to file their statement of case.
Counsel for the legislators did not oppose the motion but told the court that they would not waive their rights to reply.
The case was heard by a single judge, Justice Clemence Honyenuga.
All three NDC MPs were absent from court during proceedings.
A seven-member apex court panel presided over by Justice Nene Amegatcher ruled that stopping the new E-Levy would be detrimental to the government.
“Greater hardships will be caused to the state in meeting its developmental obligation to the people, the court held. “The balance of hardship tilt in favour of the respondent”.
It was the view of the court that an injunction on the E-Levy would deprive the government of needed revenue which would be lost for the period that the case will be in court.
However, if the applicants were successful, the Ghana Revenue Authority (GRA) could refund monies collected as E-levy to those who had paid.
The court further charged the GRA to keep an accurate record of payments so no one is shortchanged.
Background
Minority Leader Haruna Iddrisu, Bawku Central MP Mahama Ayariga and North Tongu MP Samuel Okudzeto Ablakwa wanted the E-levy implementation to be held until the substantive case challenging the constitutionality of its passage was determined.
They argued that millions of people would suffer irreparable harm if the E-Levy Act was not put on hold, and the court determined that its passage was unconstitutional.
According to them, the GRA would be unable to reimburse the millions who would have paid the E-levy, while the 1992 Constitution, which is the supreme law of the land, would have been undermined.
“That the Plaintiffs having raised an allegation of a breach of the Constitution in the passage of the Electronic Transfer Levy Act, 2022(Act 1075), in order to avoid an incalculable damage, injury, and inconvenience not only to the people of Ghana but as well as undermining the Constitution which is the supreme law of the land, the justice of the case demands that the implementation of the Electronic Transfer Levy Act, 2022(Act 1075) is put on hold until the final determination of the instant suit,” the injunction application stated.
In their substantive suit, the three MPs expressed their desire for the apex court to declare the passage of the E-Levy as unconstitutional and, therefore, null and void.
It is their case that Parliament did not have the right quorum to pass the E-Levy as stipulated under Article 104(1) of the 1992 Constitution, which the Supreme Court had recently interpreted.
According to them, at the time the second reading for the passage of the E-Levy was done, there were only 136 MPs present in Parliament instead of the required 138.
Therefore, they wanted the court to declare the whole proceedings, including the second reading, third reading, and voting to pass the E-Levy, as unconstitutional and of no effect.
They had filed an earlier application against the E-Levy on 30 March 2022.
This was after Parliament approved the policy without the participation of NDC MPs who had staged a walkout during the E-levy debate on Tuesday, 29 March,
What is the E-levy?
The E-levy is a tax applied on transactions made on electronic or digital platforms. The Minister of Finance announced in Parliament the intention to implement the bill during the presentation of the 2022 Budget.
The tax is one of the measures the government plans to use to increase the country’s tax to GDP ratio from 12 5% in 2021 to 20% by 2024.
The government said it would use the revenue for entrepreneurship, youth employment, digital infrastructure and cyber security, and provision of road infrastructure.
The E Levy is charged at the rate of 1 50% on the following transactions:
•Mobile Money transfers done between accounts on the same electronic money issuer
•Mobile Money transfers from an account on one electronic money issuer to a recipient on another electronic money issuer
•Transfers from bank accounts to mobile money accounts
•Transfers from mobile money accounts to bank accounts
•Bank transfers on an instant pay digital platform or application originating from a bank account belonging to an individual subject to a threshold to be determined by the Minister of Finance.
However, not all transfers will be affected by the E Levy.
The Levy does not apply to the following types of transfers:
• A cumulative transfer of One Hundred Ghana Cedis a day made by the same person
•A transfer between accounts owned by the same person
•A transfer for payment of taxes, fees, and charges on the Ghana.Gov System or any other Government of Ghana designated payment system
•Specified merchant payments
•Transfers between principal, agent, and master agent accounts and
•Electronic clearing of cheques
The Charging Entities are:
- Electronic Money Issuers
- Payment Service Providers
- Banks
- Specialised Deposit-Taking Institutions
- Other Financial Institutions prescribed by Regulations made under the Act.