The Minister of Finance, Dr Cassiel Ato Forson, has announced that major Value Added Tax (VAT) reforms captured in the 2026 national budget and now enacted into law are expected to return close to GH¢6 billion to households and businesses over the course of the year.

The reforms, which took effect on January 1, 2026, are aimed at easing the tax burden, stimulating economic activity and simplifying tax compliance, particularly for Small and Medium-sized Enterprises (SMEs).

In a post on his official X account on January 1, 2026, Dr Forson explained that the combined impact of the new VAT measures—through lower costs for businesses and reduced taxes on households—will provide significant economic relief as the revised VAT regime is implemented.

“Altogether, these VAT reforms are expected to return nearly GH¢6 billion to businesses and households this year alone!” he stated.

A major component of the reform package is the abolition of the COVID-19 Health Recovery Levy, which is projected to inject approximately GH¢3.7 billion back into the economy in 2026.

Additional measures include a reduction in the effective VAT rate from 21.9 per cent to 20 per cent, a substantial increase in the VAT registration threshold from GH¢200,000 to GH¢750,000, and the restoration of input tax deductibility for levies that were previously excluded from the VAT base.

According to the Finance Minister, these changes are intended to create a more efficient and business-friendly VAT system while enhancing disposable incomes and supporting broader economic growth in 2026.