Editor’s Note
This article outlines Ghana’s upcoming VAT reforms, set for September 2025, which aim to simplify compliance and ease the administrative burden on businesses following IMF consultations.
The Ghanaian government will implement sweeping reforms to its Value Added Tax (VAT) system in September 2025, targeting simplified compliance and reduced burdens on businesses after extensive consultations with the International Monetary Fund (IMF).
Sources confirm the changes address decades of public frustration with the current regime’s complexity and embedded inequities, including the contentious COVID-19 levy.
VAT’s troubled history in Ghana—introduced in the 1990s, withdrawn amid protests, and reintroduced with layered levies—has resulted in effective tax rates exceeding statutory levels. While the ruling NDC pledged opposition-era abolition of the COVID levy, the Mahama administration later clarified this required IMF alignment within broader fiscal reforms. Though full details remain undisclosed, expectations point to the levy’s removal and a simplified flat-rate system for SMEs.
At a recent VAT policy forum, Presidential Economic Advisor Seth Terkper underscored the urgency:
He argued streamlined VAT would broaden the tax net voluntarily, boosting revenues without overburdening compliant entities. The reforms align with Ghana’s IMF-backed recovery program, aiming to rebuild tax trust and enhance domestic revenue mobilization for critical public services and infrastructure.
The timing proves critical. Businesses and consumers await measures balancing fiscal responsibility with fairness, hoping reforms ease administrative hurdles while strengthening economic resilience under President Mahama’s administration. Success hinges on delivering the long-promised simplicity absent since VAT’s turbulent inception.