Dr. Cassiel Ato Forson, Ghana’s Minister of Finance, has announced a series of tax repeals aimed at alleviating the financial burden on citizens and businesses. This move marks a significant shift in the country’s fiscal policy, impacting various sectors, including gambling, mining, and digital transactions. The most prominent of these repeals is the abolishment of the 10% withholding tax on lottery and betting winnings, a measure previously implemented by the former NPP government. This means that bettors will now retain their full winnings, a move welcomed by many in the gambling community. Furthermore, the government has taken steps to address the issue of gold smuggling by removing the tax on unprocessed gold, aiming to incentivize legal channels and boost revenue collection through legitimate means.
The repeal of the Electronic Transaction Levy (E-Levy), a controversial tax on digital transactions, is another key aspect of the government’s new fiscal policy. Introduced by the previous administration, the E-Levy sparked widespread public debate and faced criticism for its potential impact on financial inclusion and economic activity. Its removal signifies a responsiveness to public concerns and a commitment to promoting a more conducive environment for digital transactions. Along with the E-Levy, the government has also repealed the emissions tax, a move that aligns with broader efforts to address environmental concerns and encourage sustainable practices.
The removal of VAT on motor vehicle insurance policies is another step towards reducing the financial burden on vehicle owners. This measure aims to make insurance more accessible and affordable, encouraging greater compliance and ultimately promoting road safety. Moreover, the repeal of the 1.5% withholding tax on winnings from unprocessed gold by small-scale miners represents a direct effort to support the mining sector and improve the livelihoods of those involved in artisanal mining. This targeted intervention acknowledges the contributions of small-scale miners to the economy and aims to formalize their operations while discouraging illicit activities like gold smuggling.
These tax repeals, which were initially outlined in the 2025 budget statement and subsequently approved by Parliament and signed into law by President John Dramani Mahama, reflect a comprehensive approach to fiscal reform. The government’s stated objective is to provide relief to households and businesses grappling with economic challenges. By reducing the tax burden across various sectors, the administration aims to stimulate economic activity, promote investment, and improve the overall financial well-being of Ghanaians. This strategy also reflects a broader recognition of the need to streamline the tax system and make it more equitable and efficient.
The government has addressed concerns about the potential revenue shortfall resulting from these tax cuts by outlining measures to offset the impact. Notably, the reduction of the current tax refund ceiling from 6% to 4% is expected to generate GH¢3.8 billion, partially bridging the gap created by the repeals. This approach aims to balance the need for tax relief with the imperative of maintaining fiscal sustainability. The government’s strategy underscores the importance of prudent financial management and proactive measures to mitigate any adverse consequences on public finances.
In essence, the series of tax repeals implemented by the Ghanaian government signifies a major policy shift aimed at revitalizing the economy and easing the financial burden on individuals and businesses. By addressing key areas of concern, such as the E-Levy, betting tax, and taxes on gold and insurance, the government seeks to create a more favorable environment for economic growth, investment, and financial inclusion. While acknowledging the potential revenue implications, the administration has outlined compensatory measures to mitigate the impact and maintain fiscal responsibility. The effectiveness of these measures and their long-term impact on the Ghanaian economy will be closely monitored in the coming years.
