A test of behavioural changes to electronic levy: Evidence from mobile money transactions in a developing country
Date
2023
Journal Title
Journal ISSN
Volume Title
Publisher
Cogent Economics & Finance
Abstract
Even before its introduction, the electronic levy in Ghana stirred up
different behavioural reactions from the public, despite the intention to use its
proceeds to provide better public services. As a result, this study examines some of
these behavioural changes using pre-tax survey data on the proposed electronic
levy. Using a sample size of 2,810 individuals with mobile money accounts, we
estimate a multivariate logit model with its marginal effects to determine the
associated drivers of individuals’ behavioural changes to the proposed tax. The
results show that the electronic levy is likely to have an immediate impact on an
individual’s behaviour in positive and negative ways. Thus, while about 88% of the
respondents indicated that they are likely to stop using mobile money or reduce
their transactions, approximately 12% of the respondents rather reaffirmed their
willingness to keep using mobile money or perhaps increase their mobile-money
transactions. Furthermore, we find evidence that income, marital status, objective
knowledge, trust in government, and the implementation timeframe are the sta tistically significant determinants of behavioural changes to the electronic tax in
Ghana. The results suggest varying behavioural responses to the electronic levy in
Ghana, which threaten the realization of expected revenues. We recommend proper
education and advocacy at all levels and a keen consideration to implement the
levy later, perhaps, when there is more trust in the government’s ability to use tax
revenues prudently.
Description
Research Article
Keywords
electronic levy, electronic tax, mobile money
Citation
To cite this article: Carlos Kokuvi Tetteh, Anthony Amoah, Edmund Kwablah, Rexford Kweku Asiama & Godson Ahiabor (2023) A test of behavioural changes to electronic levy: Evidence from mobile money transactions in a developing country, Cogent Economics & Finance, 11:1, 2202963, DOI: 10.1080/23322039.2023.2202963