The Government has presented a generally bullish, growth‑driven budget for 2026, balanced with cautious stabilisation measures aimed at consolidating gains in revenue mobilisation and compliance. The fiscal package signals a pivot toward broadening the tax base, streamlining administration through digital tools and aligning core regimes with international practice, while providing targeted reliefs to support priority sectors.
Value Added Tax (VAT)
The budget proposes a comprehensive reset of the VAT framework to simplify compliance, reduce effective rates, and leverage technology for enforcement.
- Registration threshold increased. The VAT registration threshold will rise from GHS 200,000 to GHS 750,000, focusing compliance on medium and larger taxpayers and reducing administrative burdens for micro and small enterprises.
- Reduction in the effective VAT rate. The effective rate will decrease from 21.9% to 20%, delivering modest relief to consumers and businesses while maintaining the standard rate structure.
- Reintegration of NHIL and GETFund into the VAT base. The previous decoupling of the National Health Insurance Levy (NHIL) and the GETFund levy from the VAT base will be reversed. Taxpayers will be permitted to claim input VAT in respect of NHIL and GETFund, improving neutrality and reducing cascading.
- Sectoral relief and zero‑rating. VAT on reconnaissance and prospecting activities in the minerals sector will be abolished. The zero‑rate for locally manufactured textiles will be extended through 2028, supporting domestic manufacturing and employment.
- Digital administration and compliance tools. The Ghana Revenue Authority will deploy electronic and digital solutions to enhance VAT administration, including the introduction and operationalisation of Fiscal Electronic Devices to improve real‑time reporting and invoicing integrity. A VAT reward scheme will be launched to encourage public participation in policing VAT compliance.
COVID‑19 Health Recovery Levy
The 1% COVID‑19 Health Recovery Levy will be abolished, reflecting a shift from emergency revenue measures to a normalised tax framework as macroeconomic conditions stabilise.
Income Tax Reform
The budget signals an overhaul of the Income Tax Act to modernise the regime, improve coherence, and align with evolving international standards.
- Alignment with international best practice. The reform will streamline rules, reduce ambiguities, and enhance consistency with global norms, supporting investment predictability and compliance.
- Taxation of the digital economy. Non‑resident entities with a significant digital or economic presence in Ghana will be subject to Ghanaian income tax, extending the tax net to remote providers of digital services and addressing base erosion risks.
Customs and Trade Facilitation
Customs policy will be modernised to deepen trade facilitation while strengthening border integrity and revenue assurance.
- Standards and digitalisation. Customs operations will be aligned with emerging international standards in trade facilitation, digitalisation, and border efficiency, improving clearance times and reducing administrative friction.
- Enforcement against illicit trade. Enhanced tools and methodologies will target smuggling, undervaluation, and illicit trade, seeking to protect compliant traders and secure the revenue base.
What This Means for Businesses and Taxpayers
The combined VAT and income tax reforms point to a more neutral, technology‑enabled system with a clearer incidence of taxation and improved input crediting. Businesses should assess registration obligations under the higher VAT threshold, model the impact of the lower effective VAT rate and the reintegration of NHIL/GETFund into the VAT base, and prepare for device‑based e‑invoicing and reporting. Digital service providers targeting Ghana should evaluate nexus, compliance, and withholding exposures under the new significant economic presence rules. Traders should anticipate more automated border processes paired with stronger valuation and enforcement controls.
This newsflash provides a high‑level summary of announced measures. Final scope and application will depend on the passage of enabling legislation and administrative guidance.
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