Domestic VAT collections rise 33.6% to GHc8.31 Billion in first five months of 2025

By Prince Antwi October 6, 2025

Domestic Value Added Tax (VAT) collections surged by 33.6 percent in the first five months of 2025, reaching GH¢8.31 billion, compared to GH¢6.22 billion recorded during the same period in 2024.

This was disclosed in the Bank of Ghana’s July 2025 Monetary Policy Report, which attributed the strong growth to improved tax compliance and rising consumer demand, supported by steady growth in the retail sector.

According to the report, retail sales increased by 35.7 percent cumulatively between January and May 2025, reflecting stronger household spending and a sustained recovery in private consumption.

On a year-on-year basis, retail sales for May 2025 rose 38.6 percent to GH¢277.62 million, up from GH¢200.27 million in May 2024. Month-on-month, sales climbed 4.6 percent, moving from GH¢265.46 million in April to GH¢277.62 million in May, underscoring continued consumer activity.

Domestic VAT collections also performed strongly in May, increasing 30.1 percent year-on-year to GH¢1.77 billion. The Bank of Ghana linked this growth to enhanced economic activity, stronger consumer confidence, and improved tax administration.

The report further noted that the rise in consumer spending points to a gradual rebound in domestic demand, supported by stable prices and moderate growth in disposable incomes.

However, analysts caution that maintaining this positive momentum will depend on sustained fiscal discipline, effective management of inflationary pressures, and continued policy support to preserve household purchasing power and economic stability.