The Value Added Tax (VAT) Act is undergoing a series of tax reforms to ensure the elimination of successive charges of taxation that increase the cost of goods and services.

As such, the COVID-19 Levy, Ghana Education Trust Fund (GETFund) and National Health Insurance Scheme (NHIS) levies assented to by former President Akufo-Addo during the New Patriotic Party-led government are expected to be scrapped next year.

Finance Minister, Dr Cassiel Ato Forson, while delivering the 2025 Mid-Year Budget Statement to Parliament on Thursday, July 24, said his outfit will conclude the reviewing process by the close of September, adding that the new bill will then be submitted to Parliament in October to be included in the 2026 Budget Statement.

He mentioned that the new development is aimed at reducing financial burdens on Ghanaians, thus improving economic conditions. The current VAT flat rate scheme, the minister asserts, should be a unified VAT rate for all businesses.

Additionally, the VAT registration threshold will also be raised, a measure expected to exempt small and micro enterprises from registering for and paying VAT as well as encourage growth in the informal sector.

To ensure compliance and transparency, the government has plans to roll out fiscal electronic devices such as e-invoicing systems and electronic cash registers. Furthermore, public education campaigns and awareness programs will be implemented for the public.

“Rt. Hon. Speaker, the Ministry of Finance hopes to complete this process by September 2025, prepare a new VAT bill by October 2025 and submit the same to Parliament as part of the 2026 Budget Statement.

"Mr. Speaker, I would like to reassure Ghanaians that under the reforms, at the minimum, the COVID-19 levy will be abolished, the effective VAT rate will be reduced, and the punitive cascading effect of the GETFund and NHIS levies will be removed.”

“VAT flat rates will be removed, and a unified VAT rate will be implemented; the VAT registration threshold will be increased to exempt small and micro businesses; and compliance will be improved through public education, awareness creation and the introduction of fiscal electronic devices,” he said.

Earlier this year, President John Dramani Mahama’s administration repealed the betting tax, emissions tax, and other levies. The Electronic Transaction Levy (E-Levy), introduced in 2022, imposed a 1.5% tax on electronic transactions.

Although it was later reduced to 1%, the levy remained unpopular, drawing criticism from businesses, consumers, and political stakeholders who argued that it stifled digital transactions and disproportionately affected low-income earners. Many argued that it stifled digital transactions and placed an unnecessary burden on citizens.

The removal of this tax was a core pledge in the National Democratic Congress (NDC)’s manifesto, aimed at reducing the cost of living and encouraging business expansion. With the repeal bill now signed into law, many Ghanaians breathe a sigh of relief.

Supporters of the repeal argue that eliminating these levies will promote digital transactions, stimulate economic activity, and improve disposable income for households and businesses.

The Finance Minister's tweet suggests that the government is committed to fulfilling its campaign promises and easing the financial burden on citizens.

Meanwhile, the Finance Minister has hinted at sanitization of the public sector payroll to remove the names of individuals who are not a part of government institutions but still receive salaries.

In view of this, the Audit Service will conduct a payroll audit across all 16 regions of the country aimed at retrieving GH¢150.4 million of unearned salaries.“Mr. Speaker, as part of the fiscal consolidation strategy, we have taken measures to sanitize public sector payroll and rid it of ghost names. Subsequently, we engaged the Ghana Audit Service to undertake a nationwide payroll audit across all 16 regions of the country.“Mr. Speaker, the Ghana Audit Service has completed 91% of the payroll audit. So far, the Audit Service has not been able to identify and verify over 14,000 workers again; they have identified 53,311 separated staff.

"Separated staff are staff who are either on retirement, resigned, terminated, on leave without pay, or deceased, and yet remain on government payroll; and the Audit Services expects to recover GH¢150.4 million of unearned salaries from the separated staff over the 2023 and 2024 period,” he added.

Touching on Ghana’s programme with the International Monetary Fund (IMF), the Finance Minister noted that Ghana remains on track with the implementation of the Programme.

He revealed that the government’s commitment to fiscal discipline, prudent debt management and exchange rate have paved way for a 5th review review scheduled for September.

“The 5th Review, which is scheduled for September 2025, will be based on end-June 2025 data. Preliminary data shows that Ghana is on course to achieving most of the targets for the 5th Review. Mr. Speaker, our commitment to fiscal discipline, prudent debt management, and exchange rate appreciation has resulted in significant improvement in Ghana’s debt profile,” he added.

On commercial debt restructuring, the Finance Minister stated that the Ministry has made two debt service payments of about US$700 million to Euro bondholders.

Dr Forson disclosed that beginning August, the Ministry of Finance will commence the building of cash buffers to support the repayment of Ghana’s domestic debt service obligations relating to the Domestic Debt Exchange Programme bonds which will fall due in 2027 and 2028.