Dr. Cassiel Ato Baah Forson, Ghana’s Finance Minister-designate, has pledged to abolish the controversial betting tax in his first budget if confirmed by Parliament.
Speaking during his vetting by Parliament’s Appointments Committee on Monday, Dr. Forson emphasised Ghana’s untapped potential in tax revenue mobilisation.
He argued that increasing taxes was unnecessary and that improving compliance was key to boosting revenue.
“Mr. Chairman, I have studied Ghana’s economy for some time now, and without mincing words, Ghana has the potential when it comes to tax revenue mobilisation. We don’t necessarily have to increase taxes to rake in revenue. We have the handles; what we need to do is to improve compliance,” Dr. Forson said.
He revealed plans to raise the country’s tax revenue-to-GDP ratio from 13.8% to 16% in the medium term, aligning Ghana with its economic peers.
“In the medium term, it is my vision, when approved, to increase the tax revenue from 13.8% of Gross Domestic Product to 16 or 18%. The potential is there, but it doesn’t necessarily mean we should increase taxes,” he explained.
Dr. Forson reiterated the Mahama-led government’s commitment to reducing the tax burden on Ghanaians, including scrapping certain taxes deemed counterproductive. This, he said, was consistent with his stance against policies that would place undue pressure on the public purse.
Addressing concerns about the economic impact of removing the betting tax, Dr. Forson downplayed its significance.
He described it as a “nuisance tax” that generated less than GH¢50 million annually and argued that its removal would have minimal consequences on the economy.
“Some taxes are not bringing in any revenue worth mentioning. For example, the betting tax brings in less than GH¢50 million a year. Scrapping it will not significantly affect the economy,” he noted.
The betting tax, introduced to generate revenue from the growing betting industry, has faced criticism for disproportionately targeting individuals who rely on betting for their livelihood. While the Ghana Revenue Authority projected the tax could generate GH¢1.2 billion by the end of 2023, critics have questioned its economic viability.
Dr. Forson assured the Committee of his readiness to work with the Ghana Revenue Authority and the Ministry of Finance’s tax policy unit to enhance compliance and improve revenue mobilisation. He emphasised that effective measures, rather than higher taxes, were the solution to Ghana’s revenue challenges.