The Ghana Revenue Authority (GRA) has announced that it will begin implementing the country’s new Value Added Tax (VAT) reforms from January 1, 2026, following the passage and presidential assent of the VAT Bill, 2025.

The reforms represent a major overhaul of Ghana’s VAT system and are aimed at simplifying tax administration, consolidating existing tax laws, abolishing the COVID-19 Levy, and strengthening compliance through enhanced digitisation.

According to the GRA, the new law is expected to promote fairness, improve revenue efficiency and support economic growth as government intensifies efforts to boost domestic revenue mobilisation. The reforms also form part of recommendations by the International Monetary Fund (IMF) to streamline tax collection and reduce bureaucratic bottlenecks.

Key features of the new VAT regime include the unification of the flat-rate system, a reduction in the effective tax rate, and the reclassification of the National Health Insurance Levy (NHIL) and the Ghana Education Trust Fund (GETFund) levy as input taxes that can be deducted by businesses. These changes are expected to improve cash flow for businesses and enhance overall tax efficiency.

The reforms will also be supported by the deployment of digital platforms, including the Electronic VAT (E-VAT) system, to ensure accurate and transparent tax collection.

Speaking to journalists, the Commissioner for the Domestic Tax Revenue Division of the GRA, Dr Martin Kolbil Yamborigya, explained that consumers will now pay 20 per cent VAT on goods and services, down from the current effective rate of 21.9 per cent.

“There will be significant benefits for taxpayers because the NHIL and GETFund levies have been re-coupled, which reduces the overall amount payable,” he said.

“This means businesses will make savings, and the levies can now be claimed as input taxes at the end of the accounting period,” Dr Yamborigya added.

The VAT Bill was passed by Parliament in November 2025 after it was introduced during the presentation of the 2026 Budget Statement and Economic Policy. With presidential assent now granted, the GRA is set to proceed with full implementation of the reforms from the start of 2026.