The introduction of new taxes on the gaming industry in Ghana, as outlined in the Income Tax (Amendment) Act 2023 (Act 1094), involves the imposition of a withholding tax on winnings and a tax on Gross Gaming Revenue (GGR). Here's a summary of the key points:

  1. Background
    • Gambling is legal for adults but illegal for minors in Ghana.
    • The Gaming Act, 2006 (Act 721), prohibits persons responsible for gambling machines from allowing children (persons under 18 years) to use such machines.
  2. Growth of the Gaming Industry
    • Ghana's gaming industry has experienced significant growth, including casinos, sports betting, and other games of chance.
    • The government aims to introduce new taxes to boost internal revenue mobilization.
  3. New Tax Regime
    • The Income Tax (Amendment) Act 2023 (Act 1094) introduces a withholding tax of 10% on all winnings.
    • Winnings from betting, lottery, and games of chance are subject to the withholding tax at the point of payout.
    • Income from lottery operations is subject to a tax rate of 20% on Gross Gaming Revenue (GGR).
  4. Definitions
    • Gross Gaming Revenue (GGR): The total amount staked or wagered, less prizes or winnings paid or payable.
    • Gains and Profits: The total amount staked or wagered for a person engaged in a lottery operation.
  5. Implementation Guidelines
    1. Gross Gaming Revenue Tax
      • All lottery operators (excluding the National Lottery Authority) must pay the GGR tax to the Ghana Revenue Authority (GRA).
      • Monthly returns and tax payments are due by the 15th day of the month following the GGR transaction.
      • Annual GGR tax returns must be filed at the end of each year.
    2. Withholding Tax on Winnings
      • Lottery operators are required to withhold 10% tax from the final gross payout to players/punters.
      • Returns for withholding tax on gross winnings are due by the 15th day of the month following the transaction.
      • Sports betting companies, National Lottery Authority, and private lotto operators begin withholding tax from July 1, 2023.
  6. Nil Returns
    • Operators with no withholding tax obligation for a particular month must file a "Nil" return by the 15th day of the following month.
  7. Legal Representation
    • Entities in the gaming industry are advised to have legal representation with expertise in gaming law to navigate the regulatory regime.
  8. Compliance
    • Lottery operators should engage industry experts to ensure compliance with the new tax regime.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.