Finance Minister-designate, Dr. Cassiel Ato Forson, has reassured Ghanaians that scrapping nuisance taxes such as the E-levy, Betting Tax, Covid-19 Tax, and Emissions Levy will not have a significant impact on Ghana’s revenue. Speaking during his vetting by the Appointments Committee of Parliament, Dr. Ato Forson argued that these taxes contribute minimally to the country’s total domestic revenue and could be abolished without derailing the economy.
Analysts and economists have raised concerns about the Mahama-led government’s commitment to scrapping nuisance taxes, fearing it could create a GH¢6 billion revenue gap—equivalent to 3% of domestic revenue. However, Dr. Ato Forson dismissed these concerns, stating that Ghana’s economy can sustain the removal of such taxes, especially when complemented by strategic adjustments in government expenditure.
He emphasized that the revenue generated by these taxes is relatively small. For instance, the Betting Tax brings in less than GH¢50 million annually, which he described as insignificant in the broader fiscal framework. “Scrapping nuisance taxes like the Betting Tax will not negatively affect the economy if expenditure adjustments are made,” he asserted.
The Finance Minister-designate further explained that scrapping nuisance taxes would provide relief to Ghanaians while addressing inefficiencies in the tax system. He highlighted the need for a streamlined fiscal framework, stating, “Some of these taxes are not bringing in the revenue they should, and their removal will not hinder our forward march.”
Economists have long debated the effectiveness of such taxes in Ghana’s fiscal policy. Many agree that eliminating inefficiencies and improving compliance could compensate for the revenue lost by scrapping nuisance taxes, ultimately enhancing productivity and domestic revenue mobilization.
With a projected revenue gap of GH¢6 billion, Dr. Ato Forson remains confident that scrapping nuisance taxes will not impede Ghana’s economic progress but instead foster a more equitable tax system and economic relief for citizens.
