FINANCE MINISTER DR. ATO FORSON SET TO REVIEW VAT RATE, SCRAP COVID-19 LEVY IN MAJOR TAX REVAMP
The 2026 Budget, to be presented today, is expected to simplify the tax regime to boost business growth and improve compliance, marking the most significant fiscal reforms in a decade.
Finance Minister Dr. Cassiel Ato Forson will today announce a significant reduction in the effective Value Added Tax (VAT) rate for businesses as the centerpiece of a major review of Ghana’s tax laws in the 2026 Budget Statement.
According to sources familiar with the budget, the sweeping reforms are designed to simplify the tax system, reduce the burden on businesses, and ultimately improve revenue mobilization by encouraging greater compliance. A key measure expected is the outright scrapping of the COVID-19 Levy.
This planned overhaul is being described by some analysts as a “total revamp” of Ghana’s tax architecture, reminiscent of the large-scale changes implemented between 2013 and 2016. The government believes that a simpler, less burdensome tax regime will stimulate business activity and, in turn, expand the tax base.
Beyond tax reforms, the Finance Minister is also expected to propose a review of the Public Financial Management Act. This move aims to tighten controls on government expenditure and will be supported by improvements to the Ghana Integrated Financial Management Information System (GIFMIS), which is crucial for managing the country’s debt levels.
The budget will also highlight how the government’s flagship initiatives, such as the “Big Push” and the “24-Hour Economy” programme, are expected to drive economic expansion and job creation. Dr. Forson is likely to emphasize his administration’s record of fiscal discipline and outline a credible strategy for managing the economy after the conclusion of the current IMF-supported programme.
With these measures, the government signals a strategic pivot towards fostering a private-sector-led recovery, betting that tax relief and smarter fiscal management will yield longer-term gains than maintaining higher tax rates.
Source:NKONKONSA.com
