Government engages World Bank, IMF, in push for major VAT overhaul to ease business burden

According to Finance Minister, Ato Forson, Ghana’s current effective VAT rate stands at 21.9%—possibly the highest on the continent

Ghana is set to undertake a comprehensive review of its Value Added Tax (VAT) regime as part of wider fiscal reforms aimed at easing the burden on businesses and improving compliance across the country.

This was revealed during a high-level engagement between the Finance Minister, Dr Cassiel Ato Forson and the World Bank Group, where the Ministry briefed Wencai Zhang, Managing Director and Chief Administrative Officer of the Bank, on the country’s commitment to reforming its tax architecture.

According to Ato Forson, Ghana’s current effective VAT rate stands at 21.9%, possibly the highest on the continent. The steep rate has long been criticised for complicating tax compliance and increasing the operational costs for local businesses.

VAT

To address these concerns, an International Monetary Fund (IMF) Technical Assistance Mission is currently in Ghana, collaborating with local authorities to guide the reform process. The aim is to streamline the VAT system, make it more business-friendly, and boost economic efficiency.

Ato Forson in a Facebook post today stated that a complete overhaul is actively under consideration and expected to be finalised in time for the next national budget. “The problem is known, and it is being addressed,” he said, assuring stakeholders that changes will be rolled out by November.

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