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The government has revealed plans to abolish the COVID-19 Health Recovery Levy as part of a comprehensive overhaul of Ghana’s Value Added Tax (VAT) framework, aimed at easing financial pressure on citizens and simplifying tax compliance.
Finance Minister Dr. Cassiel Ato Forson made the announcement during the presentation of the 2025 Mid-Year Budget Review in Parliament on Thursday, July 24.
“We are committed to easing the burden on consumers and businesses alike,” Dr. Forson stated, noting that the upcoming VAT Amendment Bill will address long-standing inefficiencies in the system.
Key reforms include the removal of cumulative VAT charges linked to levies such as the GETFund and NHIS, which have inflated the overall effective VAT rate. The government also intends to abolish the VAT Flat Rate Scheme, which has faced criticism for complicating compliance for small businesses.
Dr. Forson also disclosed that the VAT registration threshold will be raised—exempting more micro and small-scale traders from VAT obligations and reducing compliance burdens, especially in the informal sector.
Consultations involving the Ministry of Finance, Ghana Revenue Authority (GRA), and various stakeholders are already underway. The final version of the VAT Amendment Bill is expected to be presented to Parliament in October as part of the 2026 Budget.
In addition to these tax reforms, the government plans to introduce fiscal electronic devices and intensify public education on tax responsibilities, in a bid to improve compliance, combat evasion, and boost revenue collection without imposing additional hardship on citizens.
