The Electronic Transfer Levy, or e-levy as it is more popularly known, maybe a few months old, but the controversies surrounding the law do not look like going away anytime soon.
This law was always going to be very contentious. Even before it was passed, it was a source of constant debate amongst members of the Ghanaian parliament, with one particular session descending into chaos and blows.
The government has naturally provided arguments to back up the levy, promising to use the money collected to develop various infrastructures in the country, but most Ghanaians are not having any of it.
There is the usual mistrust between the people and the government, with many fearing that the money will only end up in the pockets of the politicians.
For the uninitiated, the e-levy, passed into law on May 1, imposes a 1.5% tax on all electronic transactions above 100 Ghanaian cedis.
Electronic transactions include mobile money payments, bank transfers and remittances. Given that mobile money is the most popular mode of transaction in Ghana, especially amongst the lower-income citizens, the general feeling is that the tax is making life harder for the average Ghanaian.
As a means to bypass the tax, some Ghanaians have turned to cash payments. There has been a noticeable reduction in the volume of mobile money transactions over the last few months.
Many industries are already feeling the effects of the tax, including Ghana’s thriving online betting sector.
Over the last decade, Ghana has developed into one of the fastest-growing online betting markets in the world, and a big reason for this rapid growth has been the advent of mobile money in the country.
With MoMo networks like MTN, Vodafone and Airtel Tigo available on all the top betting sites in Ghana, Ghanaians have made hundreds of thousands of online transactions daily, pushing the country into the top echelon of online betting nations in Africa.
After the big three of South Africa, Nigeria and Kenya, Ghana is very much the best of the rest.
However, with Ghanaian bettors now having to pay a 1.5% tax on their deposits (above GHS 100), there are fears that the previously booming industry will suffer a decline.
There is no ready-made alternative to mobile money deposits for Ghanaian bettors. Remember that the tax covers all electronic transactions, which includes card deposits and internet banking.
And making cash deposits isn’t really an option. Even if a bettor opts to deposit cash via an agent, the agent will still have to transfer the money into the player’s account electronically, and will most likely demand that the bettor covers the transaction charges.
All of these mean that bettors are effectively stuck with mobile money payments.
Interestingly, the tax doesn’t seem to have had a telling effect on online betting.
If anything, betting rates have gone up over the last three months, especially with the start of the big European football leagues like the English Premiership and the UEFA Champions League. This is another reflection of the attraction to online betting in Ghana.
There will be plenty of murmurings and dissatisfaction over the e-levy across the Ghanaian betting scene, but online betting has become so big in Ghana, almost to the point of addiction, that it will take more than a 1.5% levy to cause a significant drop in the betting numbers.