Despite calls on the government to scrap the Electronic Transaction Levy (E-Levy), /the government says it will not take that decision.
A statement issued by the Ministry of Finance noted that the government will not terminate the 1.5% levy on electronic transactions.
Several experts have asked the government to scrap the elegy following the announcement to seek an IMF bailout.
The Ministry said the government will add the proceeds from the levy to the support from the IMF to addressing the challenges we are faced with.
“Government is committed to ensuring the smooth operationalisation of all taxes including the e-levy to ensure that in addition to the IMF’s resources, government can continue to support its developmental goals on its own while ensuring that tax-to-GPD ratio increases to the peer range of 16%-18%”.
“An IMF-supported programme is likely to encourage the government to investigate the factors hindering the success of the e-levy (including by providing technical assistance if needed) and come out with strategies to improve it”.
The statement added that other tax measures could be considered for the medium-term.