Finance Minister Dr. Cassiel Ato Forson has said that government will abolish the Covid-19 levy and and make tax reforms aimed at easing the financial burden on Ghanaians and improving the fairness and efficiency of the country’s Value Added Tax (VAT) system.
Presenting the 2025 Mid-Year Budget Statement to Parliament on Thursday, July 24, Dr. Forson said the reforms will target outdated and punitive levies under the current VAT regime, with major changes expected to take effect in the 2026 Budget.
“I want to reassure Ghanaians that the COVID-19 Levy will be abolished, the Effective VAT Flat Rate will be reduced, the cascading and punitive effects of the NHIS Levy will be removed, and the GETFund and VAT Flat Rate will also be eliminated,” Dr. Forson announced.
In their place, the government plans to introduce a unified VAT rate, which the Minister said will streamline the tax system, reduce compliance costs, and eliminate inefficiencies that hurt both businesses and consumers.
These changes, he added, will be finalised by October 2025 and presented to Parliament in a new VAT Bill as part of the 2026 national budget.
The reforms are part of a broader tax and economic restructuring plan being advanced by the Mahama administration, focused on restoring macroeconomic stability, expanding the tax base, and creating a more equitable fiscal framework.
Dr. Forson explained that beyond tax changes, the government’s agenda includes strengthening public financial management, boosting domestic revenue mobilisation, and aligning monetary policy with long-term development goals.
“These reforms are designed to promote inclusive and sustainable growth, rebuild investor and public confidence, and ease financial pressures on ordinary citizens,” he noted.
The Finance Minister also emphasised that the planned overhaul is not simply about removing taxes but making Ghana’s tax system more responsive to current economic realities.
“The goal is to create a fairer, simpler, and more growth-oriented tax framework that supports job creation, encourages investment, and ensures everyone pays their fair share,” he said.
If passed, the new VAT framework would mark one of the most significant overhauls of Ghana’s tax system in over a decade, potentially lowering costs for consumers while improving compliance and boosting government revenue in a more balanced way.
