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Opposition frowns as parliament approves ‘controversial’ E-Levy in Ghana

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The legislature in Ghana has approved a new contested tax on electronic transactions which will introduce a 1.5 percent taxation on electronic money transfers and according to the government, help raise $900m in much-needed revenue.

The new tax, which is known as the E-levy has sparked widespread popular criticism in the West African country.

Ghana’s Minister for Finance and Economic Planning, Ken Ofori-Atta in the 2022 budget statement and economic policy that was presented before parliament in November 2021  revealed the government’s intention to tax all electronic transactions in the informal sector to cover the tax net.

Opposition legislators however staged a walkout of debates while the majority went on to pass the bill into act.

 “The Electronic Transfer Levy duly read today after the consideration stage has been passed,” Alban Bagbin, the speaker of parliament said.

Before they walking out of the debate however, opposition legislators dismissed the new tax as unfair.

A lawmaker from the opposition, Isaac Adongo said “the people have roundly rejected the e-levy and our constituents have told us to reject it, so why is the president imposing it on us?”

“What is the crime of Ghanaians that now the government wants to use their pockets as collateral?” Adongo remarked.

The newly passed E-levy would cover all inward remittances (which would be paid by the recipient), all person-to-person (P2P) mobile transactions (which includes sending of funds to another account, payment for goods and services, payment of utilities, all POS/Merchant payments.

A number of African countries have expanded the scope of their indirect taxes to cover digital services, but only a few have thus far implemented some form of direct digital services tax that applies to non-residents with no physical presence in their respective countries.

Earlier, this month, africanewswatch.com reported that Rwanda like Nigeria and Zimbabwe announced plans to tax online services and digital companies consumed within the country.

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World Bank predicts Mozambique economy growing at 5.7% on average

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The World Bank has predicted that the economic growth in Mozambique is expected to accelerate in the medium term averaging 5.7% between 2022 and 2024, as a result of demand recovery and economy benefits from the start of liquefied natural gas production this year.

In a report released Thursday, the World Bank said the start of LNG production at the offshore Coral Project and the expected resumption of other LNG projects would help spur the southeast African nation’s growth in the intervening year.

The World Bank said a three-year extended credit facility arrangement agreed by Mozambique with the International Monetary Fund (IMF) and budget support from other partners would further help to strengthen its economic recovery.

The IMF’s executive board had, in May, approved a $456 million program for the country, the first since the global lender suspended support to Mozambique six years ago.

However, the World Bank warned that risks remained for Mozambique’s growth, especially from rising import prices due to the conflict in Ukraine, a possible surge in COVID infection waves, and insurgency in the north.

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Nigeria, Algeria, Niger to revive Saharan gas pipeline talks

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The governments of Nigeria, Algeria and Niger Republic have held talks to revive a gas pipeline project across the Sahara which had been put on hold for over 40 years, with the potential opportunity for Europe to diversify its gas sources as the world faces a short fall as a result of the Russian-Ukraine war.

The three countries, represented by their various Petroleum Ministers, met in Abuja, Nigeria’s capital on Wednesday and resolved to set up a task force to revive the project and designated an entity to update the feasibility study.

A statement by Niger’s Oil Ministry after the two-day meeting stated that the Trans-Saharan gas pipeline project estimated at $13 billion, could send up to 30 billion cubic metres a year of supplies to Europe.

The statement added that the energy ministers of the three countries will meet again in Algiers at the end of July to “validate the proposals of the newly installed task force.”

“The pipeline should allow Europe to diversify its sources of natural gas supply but also allow several African states to access this high value energy source,” the statement said.

“With a length of 4,128 kilometres (2,565 miles), the pipeline would start in Warri, Nigeria, and end in Hassi R’Mel, Algeria, where it would connect to existing pipelines that run to Europe,” it said.

The gas pipeline idea was first proposed more than 40 years ago with an agreement signed between the three countries in 2009, but progress stalled stalled following a lack of follow through by the countries.

Earlier this month, Nigeria also took steps to revive another gas pipeline project that would pass through West Africa, Morocco to Europe.

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