Ghana’s betting tax: a comparison in a global context

Ghana has decided to introduce a 10% tax on betting winnings, as well as a broader 20% tax on gross gambling revenue (GGR) for various gambling operators. This has sparked much discussion about the effectiveness of such a move and its possible consequences. Proponents of this measure argue that apart from generating additional revenue, it can also act as a deterrent to young people who are prone to gambling. However, it is important to consider in detail whether this approach strikes the right balance, especially in light of international experience in this area.

International experience

It is important to examine international experience on the issue of gambling taxation. For example, the UK has introduced a National Lottery Tax and a General Betting Duty, which is levied on operators. This can serve as an example to analyze the effectiveness of different tax models. 

In the United States, gambling winnings are taxed as income, requiring winners to declare their income. This reflects the focus on individual income and the willingness of citizens to share their winnings with the government. Taxing individual winnings is a common practice in various countries, including the United States, which allows the government to collect revenue from gambling.

However, this approach is not without problems. For example, deductions for gambling losses have limitations and strict conditions, potentially complicating the financial situation for players. Moreover, this tax approach can act as an additional incentive for uncontrolled gambling behavior and gambling problems.

Thus, many Americans, in order to avoid paying taxes, play at online casinos from other jurisdictions. For example, at topcadcasinos.net, you can find many casinos for Canadian dollars that accept players from other countries.

The United Kingdom’s decision to refrain from directly taxing individual gambling winnings and instead tax bookmakers represents a unique perspective. This approach, known as Point of Consumption Tax (POCT), aims to create a more balanced taxation system that does not discourage gamblers but makes betting shops responsible for paying taxes.

Such a method promotes a more sustainable gambling ecosystem, looking after the financial interests of the state and reducing direct negative impacts on players. It is very interesting to see such a comprehensive approach that takes into account both the economic and social aspects of gambling in the long run.

Possible problems with the new taxation system 

One of the main concerns is that taxing gambling winnings could negatively impact low-income people, who often see gambling as a potential source of financial relief. For some of them, roulette, slots, or poker may be an attempt to fix their financial situation. Thus, taxing winnings may reduce the financial motivation to engage in gambling and exacerbate their economic inequality.

Raising revenue and combating inequality

It is important to note that raising revenue from gambling through taxation has its own importance for the state, especially for developed countries. However, steps such as the introduction of new taxes should be implemented with caution to consider and minimize the potential impact on low-income people. Historical data and international experience show that the introduction of such taxes often affects vulnerable groups.

It is important that countries when making such decisions, consider and analyze the experience of other countries in this area and explore different ways to minimize the negative impacts of the new tax system on different segments of society, especially low-income people.

Ghana, therefore, in introducing a new approach to gambling, has a unique opportunity to learn from the experience of other countries and take into account all possible impacts on citizens of different income levels. A balance between revenue generation and social responsibility is needed to ensure that new taxes not only bring revenue to the treasury but also help society as a whole without deepening existing social and economic inequalities.