The Ghana Revenue Authority (GRA) has announced a sweeping overhaul of the Value Added Tax (VAT) regime, slashing the standard rate to 20% and dramatically increasing the registration threshold for goods dealers to GHC750,000.
The reforms, enacted under the new Value Added Tax Act, 2025 (Act 1151) and taking effect on January 1, 2026, form a comprehensive package designed to reduce the cost of business and simplify tax administration.
The threshold – raised from GHC200,000 – is expected to relieve a significant number of small and micro-enterprises from the administrative burden of VAT compliance.
The GRA stated that the VAT rate reduction is aimed at “easing the tax burden on households and businesses.”
The controversial COVID-19 Health Recovery Levy has been officially abolished.Additionally, the Ghana Education Trust Fund (GETFund) and National Health Insurance Levy (NHIL) will be re-coupled with the main VAT system.
This technical change will allow businesses to claim these levies as input tax credits, effectively treating them as deductible input taxes and reducing the cost of doing business.
The VAT Flat Rate Scheme (VFRS), a simplified scheme primarily for retailers, has been abolished. It will be replaced by what the GRA describes as “a unified and more transparent VAT structure.”
In a public notice, the GRA entreated all VAT-registered taxpayers and the general public to take note of the impending changes.
The notice specifically calls on employers, accountants, auditors, importers, exporters, clearing agents, and tax consultants to familiarise themselves with the new provisions.
“The reforms are designed to simplify the VAT system, promote equity, improve administrative efficiency, and encourage voluntary tax compliance,” the GRA notice stated.
The authority has urged stakeholders with further inquiries to contact them through various channels: visiting the nearest Taxpayer Service Centre, calling the toll-free line 0800 900 110, reaching out via WhatsApp on 055 299 0000 or 020 063 1664, or emailing [email protected].
