GRA confirms January 2026 start date for new VAT law
31st December 2025
The Ghana Revenue Authority (GRA) has announced that the Value Added Tax Act, 2025 (Act 1151), will take effect from January 1, 2026, allowing businesses and taxpayers time to prepare for major changes to the country’s VAT system.
In a public notice to VAT-registered taxpayers and the general public, the Authority said the new law introduces wide-ranging reforms aimed at simplifying VAT administration, improving efficiency and encouraging voluntary compliance. The changes are expected to significantly affect how VAT is charged, reported and credited across the economy.
A key provision under the new Act is the increase in the VAT registration threshold for businesses dealing in goods, which has been raised from GH¢200,000 to GH¢750,000. The GRA said the adjustment is intended to reduce the compliance burden on micro and small enterprises by exempting more of them from mandatory VAT registration.
The Authority also announced the abolition of the COVID-19 Health Recovery Levy, removing an additional consumption tax introduced during the pandemic.
Under the reforms, the National Health Insurance Levy (NHIL) and the Ghana Education Trust Fund (GETFund) levies have been re-coupled, allowing businesses to claim input tax credits. In addition, the standard VAT rate has been reduced to 20 per cent, a move the GRA says will ease the tax burden on households and businesses.
The VAT Flat Rate Scheme has also been abolished as part of efforts to establish a more unified and transparent VAT structure.
According to the GRA, the reforms are designed to promote equity in the tax system, strengthen compliance and enhance administrative efficiency.
Employers, accountants, auditors, importers, exporters, clearing agents and tax consultants have been urged to familiarise themselves with the changes ahead of the January 2026 implementation. The Authority has also encouraged taxpayers seeking clarification to engage with its Taxpayer Service Centres or use its toll-free and digital support channels.