KEY POINTS
- The government will remove the e-levy and betting tax in the 2025 budget.
- Public opposition played a major role in the decision to scrap the levies.
- The government aims to increase VAT collection to compensate for lost revenue.
The Ghanaian government has confirmed its plan to remove the e-levy and betting tax in the 2025 national budget, following a commitment made by President John Dramani Mahama during his campaign.
Speaking in an interview on Channel One TV on March 3, 2025, Deputy Finance Minister Thomas Nyarko Ampem assured Ghanaians that these tax eliminations would be officially included in the budget, set to be presented on March 11.
According to Graphic Online, he emphasized that the move aligns with the administration’s goal to reduce financial burdens on citizens and businesses.
“The President has made it clear that he will deliver on the promises he made to Ghanaians. That includes removing the e-levy and betting tax,” Ampem stated.
E-Levy and betting tax faced strong public opposition
The e-levy, first introduced in 2022, initially imposed a 1.5 percent charge on mobile money and electronic transactions before being reduced to 1 percent due to intense public backlash.
Many Ghanaians argued that the levy placed an extra burden on low-income earners and discouraged the use of digital financial services.
Similarly, the betting tax, implemented in 2023, applied a 10 percent withholding tax on all betting, lottery, and gaming winnings.
This tax drew widespread criticism, particularly from young Ghanaians, who viewed it as an unfair penalty on an industry that provided income for many.
By eliminating these levies, the government hopes to boost economic activity while easing the financial strain on individuals and businesses.
Revenue strategy shifts towards VAT collection
With the removal of these two taxes, the government is looking at alternative revenue sources to fill the gap.
Ampem explained that the administration has identified a 61 percent VAT collection gap, meaning only 39 percent of potential VAT revenue is currently being collected.
“The medium-term revenue strategy estimates that we are missing out on 61 percent of VAT revenue. By improving tax collection, we can make up for the shortfall from removing these levies,” he said.
The government now focuses on better tax efficiency while avoiding additional financial weight on citizens.
This shift is expected to help streamline revenue generation while ensuring that businesses and individuals are not over-taxed.
