Ghana's newly elected government has announced the abolition of the gambling tax in the new budget, which has raised concerns from the Institute of Economic Affairs (IEA) in Ghana.
Currently, the country imposes a 10% tax on all gambling winnings (to be implemented in August 2023), which is automatically deducted when gambling winnings are won, and does not apply in the event of a bet being canceled or lost.
Now, newly elected President John Mahama has announced that this measure will be abolished as part of the government's budget — following Ghana's broader motive of abolishing the "nuisance tax."
The abolition of the 10% gambling tax, as well as the fiscal stability tax and emission tax, will bring President Mahama closer to working with the International Monetary Fund (IMF). However, this effort is not without opposition, as the International Energy Agency has criticized the decision, stating that the gambling tax is key to revenue generation and a tool to curb gambling problems.
It is worth noting: KPMG recently released a report emphasizing that the simultaneous abolition of electronic taxation, COVID-19 taxation, and gambling taxation could lead to a loss of 6.4 billion Ghanaian cedis (approximately $410 million).
Although there is broader support for the abolition of electronic and COVID-19 taxes, concerns about the abolition of the gambling tax are not limited to the International Energy Agency and have now begun to resonate in the national business academia.
Following a recent series of events, the International Energy Agency announced a counter-proposal to reduce the tax rate from the current 10% to 5% — rather than abolishing it completely.
