Government Abolishes Betting Tax and E-Levy in 2025 Budget
Government aims to ease financial burden and stimulate economic growth
- The government has abolished the 10% Betting Tax and 1% E-Levy
- Alternative revenue measures, including reducing the tax refund ceiling and enhancing tax compliance
- VAT reforms are on the horizon to address inefficiencies and simplify the tax structure
In a major policy shift, Finance Minister Dr. Cassiel Ato Forson has announced the removal of the contentious 10% Betting Tax and the 1% Electronic Levy (E-Levy) in the 2025 Budget Statement presented to Parliament today.
“Mr. Speaker, we will abolish the 10% withholding tax on winnings from lottery, otherwise known as the ‘Betting Tax,’ and we will abolish the 1% Electronic Transfer Levy (E-Levy),” Dr. Forson declared, emphasizing the government’s commitment to alleviating financial burdens on businesses and individuals.
The removal of these taxes aligns with the government’s broader agenda of fostering a business-friendly environment and stimulating economic growth.
A Bold Move Towards Economic Relief
Dr. Forson noted that the Betting Tax had been widely criticized by stakeholders in the gaming industry, who argued that it stifled investment and job creation. Likewise, the E-Levy, introduced to tax electronic transactions, had faced resistance from businesses and the general public.
“Despite our commitment to increasing non-oil tax revenue by 0.6 percentage points of GDP, we have programmed these nuisance taxes for removal in line with our manifesto promise,” he stated.
In addition to scrapping the Betting Tax and E-Levy, the government is also abolishing:
- The Emission Levy on industries and vehicles
- VAT on motor vehicle insurance policies
- The 1.5% withholding tax on winnings from unprocessed gold by small-scale miners
Dr. Forson stressed that the elimination of these taxes would “ease the burden on households, improve disposable incomes, support business growth, and enhance tax compliance.”
How Will the Government Compensate for Lost Revenue?
With concerns over revenue shortfalls, Dr. Forson outlined alternative strategies to bridge the gap. He revealed that the government has saved GH₵3.8 billion for 2025 by reducing the tax refund ceiling from 6% to 4%, which is sufficient to cover the losses from removing the E-Levy (GH₵1.9 billion) and the Betting Tax (GH₵180 million).
Furthermore, he emphasized a renewed focus on broadening the tax net, improving compliance, and leveraging technology to enhance tax collection efficiency.
Upcoming VAT Reforms
The Finance Minister also announced plans for a comprehensive reform of the Value Added Tax (VAT) system to eliminate inefficiencies and distortions. Ghana’s effective VAT rate currently stands at 22%, due to the inclusion of levies such as:
- GETFund Levy (2.5%)
- National Health Insurance Levy (2.5%)
- COVID-19 Levy (1%)
“Our VAT regime has been distorted and rendered inefficient. We have requested technical assistance from the Fiscal Affairs Department of the IMF on VAT reforms, with the mission set to commence in April 2025,” Dr. Forson informed Parliament.
Public Reaction and Economic Implications
The scrapping of the Betting Tax and E-Levy is expected to be met with widespread approval, particularly among young people engaged in online betting and businesses that rely heavily on electronic transactions. However, analysts and stakeholders will be closely monitoring how these changes impact Ghana’s economic landscape in the coming months.
As the government shifts its revenue mobilization strategy, the focus remains on striking a balance between tax relief and sustaining essential services and development projects.
