The Government of Ghana has announced its decision to abolish several taxes, including the controversial Electronic Transfer Levy (E-Levy) and the 10% withholding tax on betting and lottery winnings.
This announcement was made by Finance Minister Dr. Cassiel Ato Forson during the presentation of the 2025 Budget Statement to Parliament on March 11, 2025.
Key Taxes to be Abolished
Electronic Transfer Levy (E-Levy): The E-Levy, introduced in 2022, imposed a 1% charge on electronic transactions such as mobile money transfers and bank-to-bank transfers.
Betting and Lottery Tax: The government will remove the 10% withholding tax on lottery and betting winnings. Introduced in 2023, this tax faced significant opposition, especially from the youth who rely on betting as a source of income.
Emission Levy: To reduce the cost of doing business and promote a cleaner environment, the government is abolishing the emission levy imposed on industries and vehicles. This move is expected to benefit both businesses and private vehicle owners.
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VAT on Motor Vehicle Insurance Policies: The Value Added Tax (VAT) on motor vehicle insurance policies will be removed to make vehicle ownership more affordable and reduce the financial burden on motorists.
Withholding Tax on Unprocessed Gold: In an effort to support small-scale miners and promote compliance in the mining sector, the government will abolish the 1.5% withholding tax on the sale of unprocessed gold.
Government Measures to Mitigate Revenue Loss
To mitigate potential revenue losses from these tax removals, the government has proposed several measures:
Reducing the tax refund ceiling from 6% to 4% of total revenue, expected to save approximately GH₵3.8 billion.
Enhancing tax efficiency by amending the Revenue Administration Act to improve compliance and collection rates.
Focusing on economic growth to increase tax revenue from other sources, including corporate income tax and expanded formal employment.
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Expected Economic Impact
The removal of these taxes is expected to:
- Increase the use of digital financial services due to the elimination of the E-Levy.
- Boost business activities by reducing operational costs.
- Improve public confidence in government policies.
- Encourage investment in key sectors such as mining and transportation.
The government believes these measures will create a more favourable economic environment, reduce the cost of living, and foster sustainable economic growth in Ghana.
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The scrapping of the E-Levy, betting tax, and other levies represents a major policy shift aimed at relieving financial pressure on Ghanaians