GRA lottery taxation takes effect

The Ghana Revenue Authority (GRA) has commenced the implementation of the application of the tax laws of lottery operators across the country.

Effective yesterday, all lottery operators commenced withholding 10 per cent of winnings and paying as taxes to the Ghana Revenue Authority (GRA).

The lottery operators, including private lotto operators, sports betting operators, casino operators, route operators, remote interactive games and other games-of-chance operators, are also expected to pay a 20 per cent tax on their Gross Gaming Revenue (GGR).

Monitoring

The Assistant Commissioner, Communications at the GRA, Florence Asante, who confirmed this, indicated the authority had put in place measures to ensure compliance.

"We have started full implementation of the law.

We agreed with the lottery operators to start on August 15 and it has taken off," Mrs Asante said.

One of the measures, she added, was an electronic platform which all the lottery operators were hooked onto.

From the platform, Mrs Asante explained that the authority could monitor the systems of the lottery operators to find out their compliance levels.

To enable the GRA assess the correct tax from lottery operations, the authority had established a Revenue Monitoring System (RMS) to verify the actual revenue that accrued to lottery operators.

The GRA would obtain physical access to the physical infrastructure or system of the lottery operator at an equivalent point in the infrastructure or system to conduct checks when necessary.

Also, the Assistant Commissioner, Communications said the authority would use a test purchase approach where some officials of the GRA would also participate in some lottery games to test the system with the aim of finding out if the 10 per cent on their winnings would be withheld.

Mrs Asante said the authority also would verify from the platform on timely bases if the lottery operators were experiencing any challenges.

"So far we have not received any complaints concerning any challenges but we will be monitoring," she said

She commended the lottery operators for their cooperation and urged lottery stakers or game players to cooperate as well "We all need to pay taxes when we earn income to contribute to national development.

We must all play our part for the good of our nation," she said.

Revenue target

The Commissioner of Domestic Tax Revenue Division of GRA, Edward Gyambrah, last week announced the implementation of the tax which sought to raise about GH¢1.2 billion as revenue through taxation of lottery operations.

GRA, he said, was estimating to mobilise more than GH¢3 billion in 2024.

That followed the implementation of the Income Tax (Amendment) Act, 2023, Act 1094, which cites GGR of operators and winnings of players as taxable income.

Mr Gyambrah explained that the move formed part of efforts to improve Ghana’s domestic tax revenue which stood at 11.4 per cent, lower than the average of other low to middle income countries estimated at 20.02 per cent.

Per the law, he noted that lottery operators were required to withhold tax from the gross winnings at the rate of 10 per cent and added that, for casino and route operations, the withholding tax was on the final gross payout by the player.

The operations of the National Lottery Authority are exempted from the taxation since its revenue is lodged into the Consolidated Fund.