Ghanaians minority lawmakers opposed the budget proposal next year over a new levy on electronic money transfers after majority members walked out in protest.
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The country's hung parliament had been debating the spending plan proposed by Finance Minister Ken Ofori-Atta, which introduces a 1.75% levy on digital transactions, including mobile-money payments, which has become an indispensable part of how people pay for goods and services using their phones.
Speaker Alban Bagbin said that for the first time a majority has walked out of its own business, following heated proceedings that were adjourned until Tuesday.
Mobile-money transactions, first introduced in Ghana in 2009 by the local unit of Johannesburg-based MTN Group, surged 82% to 564 billion cedis $91.9 billion last year. Users of the platform can also get loans and buy insurance without needing a bank account to open a bank account, as well as cash transfers. More than 40% of adult Ghanaians do not have a bank account.
Majority Leader Osei Kyei-Mensah Bonsu said the e-levy is the cornerstone of the budget. Where can we get the money to do the roads? Minority members said the move would affect ordinary Ghanaians and they refused to meet With Ofori-Atta who tried to convince them ahead of the budget vote. Since Dec. 7, the country has had a near-identical number of members from each of its two main parties - a situation that is complicating President Nana Akufo-Addo's legislative agenda.
The tax, which was to take effect from February, was designed to help reduce the deficit from 12.1% of gross domestic product this year to 7.4% in 2022. The country hopes to increase to 75% of all adults by 2023, from 58%, as opposed to the move that would slow financial inclusion.
The yield on the Ghana dollar bond maturing in 2032 advanced by 0.12 basis points to 11.7% after Friday s budget vote.
Mobile money is the fastest-growing source of income for wireless network operators like Johannesburg-based MTN and African units of Vodafone Group. Sub-Saharan Africa has more mobile-money accounts than anywhere else in the world, with about 396 million at the end of 2018, or 46% of all customers, according to the GSMA, the global mobile-operator industry group.
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