Bokpin – Take another look at betting tax

As Ghana anticipates the presentation of the 2025 budget on Tuesday, March 10, economist Prof Godfred Bokpin has called on the government to reconsider its stance on the betting tax.

His remarks come amid the government’s pledge to scrap some levies, including the e-levy, COVID-19 levy and betting tax.

In an interview on Joy FM’s Middaynews on Monday, ahead of the budget presentation on Tuesday, Prof Bokpin noted that expectations are high but must be tempered with realism, given that this will be the new administration’s first major budget.

“My expectation is that they will stay on the path of fiscal consolidation, primarily using taxation as a key tool. However, I anticipate some revisions to the tax regime, particularly the removal of the e-levy and COVID-19 levy,” he said.

“With the betting tax, I believe the government should reassess its approach due to the behavioural implications and other related factors.”

He further emphasised that while the emission tax remains on paper, it has not yielded any revenue and, therefore, requires no immediate adjustments.

Addressing concerns about potential fiscal losses from the removal of these taxes, Prof Bokpin estimated that revenue losses could exceed GH₵ 7 billion. However, he suggested that these losses could be offset through administrative and compliance reforms within existing tax structures, particularly corporate income tax and VAT, both of which he described as inefficient.

“If we can improve VAT efficiency by even 15%, it will generate more than enough revenue to cover these losses,” he explained. “We should not view the removal of these taxes as losses but rather as incentives to households and businesses, which will stimulate consumption and promote economic growth.”

Prof Bokpin also underscored the need for the budget to emphasise cost savings through the elimination of wasteful government expenditures and the adoption of a lean government approach, stressing that there must be clear projections for cost-cutting measures and their impact on fiscal space in 2025 and beyond.

Additionally, he urged the government to provide a transparent assessment of the country’s fiscal position as of the end of 2024, acknowledging that Ghana is unlikely to meet its revised target of a 3.5% deficit-to-GDP ratio and a 0.5% primary surplus. He called for clarity regarding arrears from state-owned enterprises and other financial commitments.

“We need an honest, data-driven assessment of our fiscal situation,” Prof Bokpin said. “It is crucial to tell the story as it is without exaggeration, so we can make informed policy decisions.”