Dr Cassiel Ato Forson
The government has proposed the removal of several ‘nuisance’ taxes as part of its 2025 fiscal policy in a bid to ease the burden on households and support business growth.
Finance Minister, Dr. Cassiel Ato Forson, made this announcement during his presentation of the 2025 Budget Statement to Parliament yesterday.
Dr. Forson explained that the proposed tax cuts align with the government’s commitment under the IMF-supported programme to improve domestic revenue mobilization and achieve debt sustainability.
These measures aim to provide fiscal space while stimulating economic activity and ensuring long-term economic growth.
The Finance Minister revealed that the government plans to abolish a range of taxes, including the 10% withholding tax on lottery winnings, the 1% Electronic Transfer Levy (E-Levy), the Emission Levy on industries and vehicles, the VAT on motor vehicle insurance policies, and the 1.5% withholding tax on unprocessed gold winnings by small-scale miners.
Dr. Forson emphasised that removing these taxes would not only increase disposable incomes for households but also support business growth and improve tax compliance across various sectors.
He underscored that these changes reflect the government’s promise to reduce the tax burden on Ghanaians and create a more conducive environment for businesses to thrive.
“The removal of these nuisance taxes will ease the burden on households, support business growth, and improve overall tax compliance,” Dr. Forson stated.
In addition to these tax cuts, Dr. Forson also addressed the issue of the Tax Refund Account, which has been subject to abuse in recent years.
He stated that a recent study revealed that while GH¢29.11 billion had accrued to the tax refund account over the past eight years, only 43% of this amount was used for its intended purpose.
According to him, the remaining funds were misapplied, in violation of financial management laws.
To address this, the government is reducing the tax refund ceiling from 6% to 4% of total revenue, Dr. Forson noted.
He pointed out that this change would save the country GH¢3.8 billion, which would be sufficient to cover the revenue shortfall caused by the removal of the E-Levy and the Betting Tax.
“By reducing the ceiling on tax refunds, we will save GH¢3.8 billion, which is more than enough to close the revenue gap from the taxes we are removing,” he affirmed.
By Ernest Kofi Adu, Parliament House