Reduce betting tax to 5% and retain it – IEA tells gov’t ahead of Budget presentation

The Institute of Economic Affairs (IEA) has urged government to retain the betting tax but reduce it from 10% to 5%.

The IEA in a statement outlining its expectations ahead of the presentation of the budget on Tuesday, March 11 said the betting tax is useful for revenue and deterrence.

The NDC Government has promised to abolish a number of taxes, including the E-Levy, Covid Levy, Emissions Tax and Betting Tax.

The IEA agrees with the abolishment of the E-Levy, Covid Levy, Emissions Tax because the Institute says they are “nuisance” taxes.

“However, in our view, the Betting Tax is useful for both revenue and deterrence purposes and should be retained, although it could be reduced from 10% to 5%,” IEA said in a statement on March 10.

The Institute also wants government to abolish the Growth and Sustainability Tax in its 2025 Budget.

“Further, the Growth and Sustainability Tax, formerly the Fiscal Stability Tax, that was imposed on selected companies as far back as 2001 to raise revenue to help stabilise the economy, is obsolete and should be abolished as well,” IEA noted.

IEA further suggested a number of tax compensatory measures that government could use to offset the revenue loss expected from the abolition of these taxes.

These includes; Plugging the numerous tax loopholes (including trade mis-invoicing, tax exemptions, transfer pricing, under-collected property taxes, and tax evasion); ii. Broadening the tax base by using digitisation to increase formalisation of the economy; and iii. Improving efficiency of tax administration, including through the use of modern technology.

IEA urged government to consider exploring new tax innovating including taxing excess profits of extractives companies, telcos and banks.

“Super-profit or wind-fall tax, as it is called, is common and has been adopted by several countries such as: Australia, United Kingdom, India, Italy, Hungary, United States and several other EU member states. Ghana should not be scared that imposing such a tax will drive away the companies,”

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