HomeGeneral NewsGoing to IMF does not imply the E-levy will be eliminated– Kweku...

Going to IMF does not imply the E-levy will be eliminated– Kweku Kwarteng

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Kweku Kwarteng, the chairman of the finance committee of parliament, has dismissed claims made by a segment of the public that Ghana’s decision to request a bailout from the IMF will result in the elimination of the controversial E-levy tax.

Ken Ofori-Atta, the minister of finance, had previously made remarks to the contrary, but Mr. Kwarteng said that the E-levy was never suggested as a replacement for the IMF.

Speaking on Eyewitness News on Friday, he predicted that the IMF will likely demand the implementation of additional levies while urging a decrease in government spending.

“I’ve heard people make comments as though the pain of E-levy can be escaped if you go for an IMF programme. The IMF is going to come and start discussions. When they come to your country, they do not come and tell you to relax taxes. In fact, they will probably come and say E-levy is not enough. When IMF comes to your economy, the records show, they will say don’t employ people, cut your expenditures and increase your revenue so you may have to take on more revenue measures,” he said.

On Friday, July 1, 2022, the Ministry of Information said that President Akufo-Addo had given the go-ahead for Ghana to start negotiations with the IMF for a bailout. The ministry said that Ken Ofori-Atta, the minister of finance, would be in charge of negotiating with the IMF in the next days.

Mixed emotions have been expressed in response to the announcement since it represents a significant U-turn by the administration after it made a commitment never to participate in an IMF program.

According to Ken Ofori-Atta, the administration chose a domestic strategy over an IMF program.

The domestic initiative includes the implementation of the E-levy, which has reportedly so far failed to generate the anticipated amount of income.

There are rumours that the government may abandon the E-levy in light of Ghana’s statement that program negotiations with the IMF would start shortly, but Kwarteng contends that they won’t.

“The idea of either E-levy or IMF will only be projected by people who don’t understand how the economy works and how the IMF operates. When they come, we will see the conditionality they put on the table and see whether it is E-levy or IMF, ” he stated.

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