With the rollout of the 2026 VAT reforms under Act 1151, the Ghana Revenue Authority (GRA) has made it essential for businesses and service providers to understand VAT registration requirements and the shift from the flat rate to the standard rate. Clarity on these points is critical for companies and service providers across the country to ensure compliance, accurate pricing, and effective financial planning.
Dominic Naab, Acting Head of the Strategy and Research Department at GRA, explained the new thresholds and obligations. “The 750,000 threshold is only applicable to the supply of goods. Supply of services, there is no threshold,” he said, indicating that all service providers, regardless of turnover, must register. “Every person who provides services must be registered for VAT… the VAT is a consumption expenditure tax; it is the consumer who is actually paying the tax.”
For businesses already registered under the previous VAT regime, the transition period carries specific instructions. “All persons who are registered under the previous regime must continue to charge VAT at a standard rate… the transitional arrangement, you are supposed to charge VAT at the standard rate,” Naab said. Despite the changes in the law, companies must continue adhering to VAT regulations until the GRA completes all necessary administrative procedures.
The abolition of the VAT flat rate has also caused significant adjustments for companies. Previously, VAT could be charged under four categories, including flat rates of 3% and 5%. Under the new law, Naab explained, “Previously, we had four categories… now all these persons… please continue to charge VAT at the standard rate because that flat rate under the current regime is gone.”
For businesses operating under the flat rate system, this means returning existing VAT flat rate booklets to the GRA. “VAT flat rate persons are required to return unutilized VAT flat rate booklets to the commissioner general… until you are migrated and deregistered,” Naab clarified. Until deregistration or migration is completed, businesses must charge VAT at the standard rate. “You can no longer charge the VAT flat rate. And the commissioner general has also not deregistered you… keep charging VAT, but at the standard rate.”
On the ground, these reforms have immediate implications. Companies supplying goods must now ensure their turnover exceeds GH₵750,000 before charging VAT, while all service providers must register regardless of size or revenue. Accounting teams across sectors are reviewing processes to ensure compliance with the standard rate, while business owners are adjusting pricing strategies to reflect the uniform VAT application.
