The Ghanaian government has given the go-ahead to impose a 10% tax at the point of payout on winnings from lotteries, games of chance, and sports betting.
Furthermore, a 20% tax will be levied on the revenue of betting businesses operating in the nation.
Ghana, formerly referred to be the bright star of Africa, is currently experiencing a severe economic crisis. This is why the government is implementing more measures to raise domestic tax income, which is why the move is a part of that endeavor.
Mixed Reactions from Ghanaians
Ghanaians have harshly criticized the new taxation move on social media. We have highlighted a few examples below:
Who really advises this government? You come to power and killed the hope of the youth. Now ,you want to touch the only source of livelihood? And you think they’re not going to react? 2024 awaits us all.@kwabena_k2 on Twitter.
Some netizens were unhappy that they will be further subjected to withdrawal charges by mobile money operators once they withdraw the already taxed balance to their mobile wallets.
That same money in my momo will be deducted again after withdrawal. Ghana’s government is a criminal and needs to be arrested by ICCAdded @bem_ghana on Twitter.
The majority of people who expressed their feelings after the news became public were discouraged by it and even went on to propose other actions that the government might have taken instead of taxing winnings.
Lessons from Kenya
A good example to benchmark with is Kenya, where the Withholding tax on winning wagers decreased by Sh1.42 billion in the fiscal year that ended in June 2022, suggesting a downturn in the market amid the crackdown on the sector in the country.
The taxman reported collecting Sh5.67 billion in withholding tax from winning wagers in the reviewed period, a 19% decrease from Sh7.09 billion in the prior year.
The decline is due to a slowdown in the gambling business as a result of higher gambling taxes as the government works to curb the betting craze, which is especially prevalent among young people and unemployed Kenyans.
Gamblers in Kenya pay a 7.5 percent tax on each wager in addition to a 20 percent winnings tax that was reinstated in July of last year.
What to expect.
In the past ten years, Ghana’s betting sector has experienced phenomenal expansion, which has encouraged numerous bookmakers to establish operations there.
This revelation is a terrible portent for the already mature gambling industry in Ghana and could have negative effects on it. This is so because gaming revenues are anticipated to decline if the new move is implemented.