Ghana’s Gambling Tax Repeal Could Revive Betting Industry

_{A policy introduced during Ken Ofori-Atta's tenure as Finance Minister, Ghana's 10% tax on gambling winnings, has been abolished. (Image: Associated Press / Alamy)}

Could Ghana's recent decision to abolish the 10% tax on gambling winnings serve as a case study for other countries contemplating similar measures?  

The recent decision, made only two years after the decision was made to enact the gambling tax in 2022, raises significant implications, not just for Ghana’s betting industry but also for gambling regulations in other jurisdictions.  

Ghana initially introduced the 10% tax on gambling winnings, aiming to bolster government revenue from sports betting, lotteries, and casino games. 

The responsibility for this tax fell to the Ghana Revenue Authority (GRA). However, the implementation faced immediate hurdles. 

Companies Struggled to Implement Tax 

Gambling companies in Ghana struggled to come to terms with the tax, often determining whether the tax applied to total winnings or just profits. 

For online casinos, real-time calculations became an operational nightmare. Gamblers sought alternatives, often gravitating toward unregulated offshore sites or informal local betting, complicating government oversight and revenue collection. 

The decision to end the tax came as a result of some of the failings, including the failure to meet revenue expectations and a decline in betting activity due to the new tax burden.  

Some Gamblers Moved to Unregulated Platforms 

There was also a move of bettors to untaxed platforms and operational difficulties surrounding tax collection. Coupled with high administrative costs associated with enforcing the tax, licensed betting companies reported a loss of customers to unlicensed competitors.  

​​The Ghanaian government bit the bullet and rescinded the tax, citing several key reasons:

• Insufficient financial returns from the policy
• High administrative and enforcement costs
• Persistent complaints from betting operators over business impacts
• Loss of competitiveness compared to neighbouring countries with more favourable gambling regulations 

Repeal Welcomed by Majority of Industry 

The repeal was generally welcomed by the industry, with many anticipating a rebound in business activity. 

Not all in Ghana supported the scrapping of the tax. Financial experts expressed that a more measured approach—such as adjustments to the existing tax regime—could have been more beneficial than outright removal. 

They argue that scrapping the tax reflects inadequate foresight and could deter future investment in the Ghanaian market. 

There is also concern about the potential loss of revenue that could have bolstered public services. Ghana may choose to take a different regulatory path for gambling companies, potentially focusing on measures such as:

• Increasing licensing fees for betting operators
• Imposing taxes on company profits instead of player winnings
• Strengthening advertising regulations and promoting gambling awareness
• Implementing safer gambling practices to protect consumers
• Educating the public on the risks associated with gambling

The implications of this move by the Ghanaian government may be viewed by others as a signal to review their regulations. They may wish to consider the events in Ghana when considering significant regulatory changes.