The Ghana Chamber of Mines has reiterated its opposition to an increase in the Growth and Sustainability Levy as well as other existing but obnoxious taxes which threaten to erode the industry’s global competitiveness and growth.
The Chamber warned that the government’s recent fiscal policy changes particularly a 3% levy on gross mineral production and existing taxes Value Added Tax (VAT) on mineral exploration could prompt an exodus of investment and push key players out of the country.
“Exploration is the lifeline of mining and now there’s a VAT on exploration. Most of these explorers are risk takers, but they are being punished for taking that risk.” Ahmed Nantogmah, Acting Chief Executive of the Chamber, mentioned in an interview.
At the heart of the Chamber’s concern is the impact of VAT on core exploration activities such as drilling and geological assays processes that are expensive and often yield uncertain results.
“You can imagine putting $10 million into exploration, making no discovery, and still paying VAT on that failed attempt. That VAT will not be refunded. It’s money thrown down the drain,” Nantogmah said, pointing to the potentially devastating consequences for early-stage firms.
Unlike large mining multinationals, greenfield exploration in Ghana is primarily driven by small and mid-sized companies entities without the financial clout to absorb sudden cost increases. Many of these firms, the Chamber says, are already relocating operations to more exploration-friendly jurisdictions such as Côte d’Ivoire and Kenya.
“These companies are small, they don’t have deep pockets. That’s why they go to places like Kenya or Ivory Coast, where they don’t pay this VAT. So, you’ll see a movement of exploration companies going there.” he stressed.
This migration of exploration capital, the Chamber warns, poses an existential threat to Ghana’s long-term mining prospects.
“No exploration today means no new mines tomorrow,” Nantogmah emphasized.
Industry analysts say Ghana’s policy shift could not come at a worse time. As global competition for mineral investment intensifies especially for critical minerals like gold, lithium, and bauxite countries are racing to provide attractive investment climates. Ghana’s tax-heavy approach, critics argue, risks placing the country on the losing end of this race.
The Chamber is urging government policymakers to reconsider the tax framework and introduce incentives that encourage exploration rather than deter it. Proposals include VAT exemptions for exploration activities, tax reliefs for early-stage companies, and broader reforms to streamline exploration licensing and regulatory compliance.
“This is not about avoiding taxes, it’s about creating a sustainable mining ecosystem that encourages investment, supports innovation, and secures Ghana’s place as a top-tier mining destination.” Nantogmah clarified.
With mining contributing significantly to government revenue, foreign exchange earnings, and employment, the stakes are high. The Chamber of Mines’ warning serves as a reminder that nurturing the roots of the mining industry exploration is essential to reaping long-term benefits.
If unaddressed, stakeholders fear the policy missteps could reverse decades of progress in one of Ghana’s most vital economic sectors.
