Ato Forson Outlines Bold Economic Reforms: Abolishing E-Levy, Betting Tax, and Prioritizing Fiscal Prudence

<"Vetting of Dr. Cassiel Ato Forson as Finance Minister-designate". >
Ato Forson Outlines Bold Economic Reforms: Abolishing E-Levy, Betting Tax, and Prioritizing Fiscal Prudence

Dr. Cassiel Ato Forson, Ghana's Finance Minister-designate, has unveiled a comprehensive and ambitious plan to steer the nation toward fiscal stability and economic growth. His agenda includes abolishing the controversial E-Levy and betting tax within 120 days of assuming office. During his vetting by Parliament's Appointments Committee on January 13, 2025, Dr. Forson detailed his vision, emphasizing prudent expenditure management, enhanced tax compliance, and sustainable fiscal policies. 

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Abolishing the E-Levy: A Relief for Ghanaians 

One of the standout pledges by Dr. Forson is the swift abolition of the Electronic Transactions Levy, commonly known as the E-Levy. The E-Levy has been a point of contention since its introduction, drawing widespread criticism from Ghanaians who view it as an unnecessary financial burden during tough economic times. 

 

“As part of our 120-day agenda, we will abolish the E-Levy,” Dr. Forson declared unequivocally during his vetting. He explained that the levy, initially implemented to boost government revenue, had failed to achieve its objectives, instead fueling public dissatisfaction and reducing the use of digital payment platforms. 

 

The removal of the E-Levy aims to ease the financial burden on citizens and promote a more inclusive digital economy. Dr. Forson’s approach signals a shift in policy, focusing on alternative methods of revenue generation that do not overburden taxpayers. 

 

Betting Tax: Scrapped for Economic Progress 

In addition to the E-Levy, Dr. Forson has committed to scrapping the controversial betting tax, a move he believes will not hinder the country’s economic progress. He emphasized that eliminating the betting tax would have minimal impact on government revenue and argued that the focus should shift to improving compliance with existing tax laws. 

 

“Scrapping the betting tax will not affect the forward march of the economy,” Dr. Forson stated. He further highlighted that increasing taxes is not the only way to enhance revenue. Instead, he advocated for boosting compliance as a more sustainable and equitable solution. 

 

By removing the betting tax, Dr. Forson aims to create a more supportive environment for industries while encouraging better tax compliance across sectors. 

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Focus on Tax Compliance Over Tax Hikes 

A core pillar of Dr. Forson’s economic strategy is improving tax compliance rather than introducing new taxes or increasing existing rates. He argued that Ghana's fiscal challenges cannot be resolved by tax hikes alone. Instead, efficient revenue mobilization through compliance with current tax laws is key to achieving sustainable growth. 

 

“You don’t have to increase taxes to increase revenue. What is important is to increase compliance,” he emphasized. 

 

Dr. Forson’s plan includes modernizing the country’s tax collection systems, investing in digital tools, and strengthening oversight mechanisms to ensure every citizen and business pays their fair share of taxes. 

 

Cutting Wasteful Spending: A Path to Fiscal Prudence 

Another cornerstone of Dr. Forson’s agenda is tackling wasteful public expenditure. During his vetting, he stressed the need for decisive action to stabilize Ghana's economy through prudent management of government spending. 

 

“It’s not always about revenue, but expenditure,” he said, underscoring the importance of cutting unnecessary costs and channeling resources into productive sectors of the economy. 

 

Dr. Forson’s fiscal reforms aim to strike a balance between revenue mobilization and expenditure control, ensuring resources are allocated efficiently to stabilize inflation, create jobs, and maintain a stable exchange rate. 

 

Medium-Term Economic Vision: Increasing Tax-to-GDP Ratio 

Dr. Forson also outlined his medium-term economic goals, which include increasing Ghana's tax revenue as a percentage of GDP from the current 13.8% to between 16% and 18%. This ambitious target is central to his strategy for fiscal sustainability and reducing Ghana’s reliance on external borrowing. 

 

Achieving this goal will require a multi-pronged approach, including improved tax compliance, reduced corruption, and enhanced efficiency in tax administration. 

 

Free SHS Policy: Here to Stay 

In response to concerns about the continuity of the Free Senior High School (SHS) policy, Dr. Forson assured Ghanaians that the initiative would remain intact under the new government. 

 

“Free SHS has come to stay,” he declared during his vetting, reaffirming his party’s commitment to the program. Dr. Forson described the Free SHS policy as a significant milestone in Ghana’s educational journey, emphasizing its importance in ensuring equitable access to education for all. 

 

This assurance comes amidst broader discussions on the country’s educational policies and expenditure priorities. Despite fiscal challenges, the government remains dedicated to maintaining Free SHS as a cornerstone of its agenda. 

 

Domestic Debt Exchange Programme: A Commitment to Resolution 

Dr. Forson addressed concerns surrounding Ghana’s Domestic Debt Exchange Programme (DDEP), which was launched as part of efforts to restructure the country’s unsustainable debt. While the initiative has faced backlash due to losses incurred by creditors, Dr. Forson pledged to resolve the challenges and ensure all repayments are made. 

 

“We will do whatever it takes to clear the harms that have been created as a result of the domestic debt restructuring,” he promised. 

 

Dr. Forson detailed Ghana’s repayment obligations, which include GH¢12.6 billion in 2025, GH¢15.7 billion in 2026, and GH¢53 billion in 2027. He also highlighted challenges with Eurobond repayments, noting that $364 million had already been paid, with an additional $1 billion due annually from 2026. 

 

His administration plans to implement measures to mitigate the negative impacts of debt restructuring while ensuring a stable economic recovery. 

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No Immediate Plans for Additional IMF Support 

Dr. Forson also clarified his position on Ghana’s relationship with the International Monetary Fund (IMF), denying claims that he intends to request additional financial support. 

 

“I didn’t say I was going to request additional finance from the IMF,” he said, calling out inaccurate media reports. “What I said was that we could request additional finance if the need arises.” 

 

Dr. Forson emphasized the importance of maintaining flexibility in managing Ghana’s economic affairs and reassured the public that any decision to approach the IMF would be based solely on necessity. 

 

A New Path for Ghana’s Economy 

Dr. Ato Forson’s proposed reforms signal a bold and transformative approach to addressing Ghana’s economic challenges. By prioritizing the abolition of burdensome taxes like the E-Levy and betting tax, enhancing compliance, cutting wasteful spending, and maintaining a commitment to key social programs like Free SHS, his agenda aims to create a stable and inclusive economy. 

 

His medium-term vision of increasing the tax-to-GDP ratio, coupled with his focus on fiscal prudence, demonstrates a clear commitment to sustainable economic management. While challenges remain, Dr. Forson’s proactive and people-centered approach offers a promising path forward for Ghana’s economy. 

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As he awaits parliamentary approval, Ghanaians will be watching closely to see how his plans materialize and whether his promises translate into tangible benefits for the nation.

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