Mobile Money Tax: "It will discourage financial inclusion, stifle electronic money transfers and slow down economic progress." Dr Ndah Grimbald

Since the January 1, 2022, Cameoonians have been paying a new 0.02% tax instituted by the Cameoon Government on Mobile Money Transactions. Inscribed in the 2022 finance law, the tax which seeks to increase state revenue has not gone down well with many Cameroonians. Social media has been awashed by messages of Cameroonains either making a mockery of the tax in relation to other forms of financial transactions in the country or outrightly condemning it. 
Dr. Ndah Grimbald, University Lecturer & Researcher and Centre Regional Secretary of the SDF

In an effort to understand the the new law,'s Editor Bakah Derick talks with Dr Ndah Grimbald, University Lecturer and Researcher in the Banking and Finance Sector. The lecturer who is also a politician examines the impact of the tax on the ordinary man, the government and analyses possibilities for it's success. Dr Ndah also looks at the law in relation to the taxing of 'Njangi' groups. This is the full interview 

Bakah Derick: Thank you for accepting to talk to Hilltopvoices. Dr Ndah what does the new tax on mobile money transactions mean to an ordinary man? 

Dr Ndah Grimbald: This tax is unfortunately an additional cost burden on the ordinary man - retailer, buyam-sellam, road side vendors etc...because it has the very strong potential to discourage electronic money transactions. Basically, it simply means that the ordinary man will incur more cost in doing business  and by sending and/or withdrawing money. It is a double taxation because according to the Principle of taxation, something should not be taxed if it has already been taxed before. A 0.2% tax on each transaction implies there shall be multiple taxations if for example you decide to send/withdraw only a part of the sum total of money in your mobile money account. The mobile money operator is being taxed and the customer is also being taxed per transaction. It will discourage financial inclusion, stifle electronic money transfers and have a slow down effect on economic progress.

Bakah Derick: Do you consider this a genuine source of revenue for the state?

Dr Ndah Grimbald: Well, the government is trying to increase it's tax base and by implication revenue. This is one means they believe will bring in more money to the state coffers but such a tax policy has the risky potential of instead reducing the total revenue collected at the end of the day. It could instead lead to the paradox of revenue reduction through the enlargement policy of the tax base. It is in m'y opinion, from all indications not a genuine and sustainable source of revenue because it will, without doubt penalise the ordinary man in Cameroon.

Bakah Derick: How much do you estimate the government can make from this? 

Dr Ndah Grimbald: Mobile money transactions have increased so fast and tremendously since 2012. As at the end of last year 2020 and according to the BEAC report on "les services de paiement en monnaie électronique dans la CEMAC" in 2020, Cameroon had 19.5million mobile money accounts with a total volume of 10,878,742 billion francs of mobile transactions. It is also estimated that about 7,500 million mobile money operations we're conducted within this period. While waiting for complete data for 2021, and going by the rule of numbers, a rough estimate will imply an increase in the number of accounts and the volume of transactions. Hence, going by the 0.2% tax on each mobile money transaction, it is estimated that government make more than 30 billion francs from the imposition of this new tax.

Bakah Derick: Please can you share with us your reaction on the Njangi tax and how applicable?

Dr Ndah Grimbald: Recall that the tax on njangi (falls under a non-profit making association) is not a new tax law. It has been existing as a law in the general tax code (GTC) before under article 93. It is a law that enacted but not implemented until now that is being modified in order for it to be applicable. Note should be taken that it is not only njangi's that are targeted but all other non-profit making organisations such as projects in government ministries, state agencies etc...however, there has been much buzz on njangi's because it concerns the struggling Cameroonian trying to make earns meet. Article 93 of the GTC is a tax applied to non-profit making institutions. However, this tax does not apply to njangi groups that only collect savings of members and redistribue at the end of period like it is commonly practiced. It is applied only to commercial activities undertaken by these njangi houses that generate revenue and interest like purchasing a land, building a apartment and giving it out for rents, loaning money, investing in one activity or the other etc .....

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