The Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI), Mark Badu Aboagye, has welcomed the government’s decision to reform the country’s Value Added Tax (VAT) system. However, he has expressed concerns over the lack of a clear timeline for implementation, which he believes creates uncertainty for businesses.
According to Mr. Badu Aboagye, Ghana’s current VAT structure is unnecessarily complex, combining standard VAT with straight-line levies such as the National Health Insurance Levy (NHIL) and the Ghana Education Trust Fund (GetFund) levy. This, he noted, makes compliance difficult for businesses and increases operational costs, which are often passed on to consumers—ultimately contributing to inflation.
Speaking on the issue with The High Street Journal, he stated: “We have complained that this structure of VAT is not good. It doesn’t give the government or the ministry the necessary revenue because compliance obviously will be low due to the complicated nature of the tax. You don’t combine a standard VAT with a straight-line levy—it’s not done anywhere.”
While the government in its 2025 budget presentation, acknowledged the need to reform the VAT system and announced the formation of a committee in collaboration with the International Monetary Fund (IMF) to review it, Mr. Badu Aboagye believes businesses need clarity on when these changes will take effect.
“They were not specific on when they are going to do that. That’s one of my concerns. But I’m hopeful that the committee they are setting up together with the IMF will come on board as quickly as possible and ensure that the VAT system is also reformed to suit businesses,” he added.
He further explained that the current structure places a heavy tax burden on businesses, as they cannot claim input VAT on some levies, making the cost of operations higher. This forces businesses to pass the burden onto consumers, leading to higher prices of goods and services.
The GNCCI has long advocated for a simplified VAT system that improves compliance, enhances revenue generation for the government, and supports business growth. Mr. Badu Aboagye urged the government to expedite the process, ensuring that VAT reforms are implemented in a way that benefits both businesses and the broader economy.
While the government has not introduced any new taxes in the 2025 budget, the business community remains watchful, hoping that the promised reforms will not only be announced but also swiftly and effectively executed.
