Deloitte Ghana is calling on government to take a bolder approach to tax reforms by lowering the effective Value Added Tax (VAT) rate to 17.5% in next year’s mid-year budget review.
According to Yaw Appiah Lartey, Partner for Strategy and Partnerships at Deloitte, the 2026 Budget’s proposed reduction to 20% is still too costly for businesses, particularly as firms in other African markets enjoy more competitive tax regimes.
Speaking at the Ghana National Chamber of Commerce and Industry (GNCCI) Budget Review Seminar, he said a more aggressive cut would significantly improve the business environment.
“The VAT at 20% is still too high. Considering our sub-Saharan African competitors, government should consider reducing the rate closer to 17.5%, which served the country for many years,” he noted.
While commending the government for scrapping the COVID-19 levy and restructuring VAT rules to ease compliance, he argued that deeper cuts would support growth, attract investment, and reduce the tax burden on struggling businesses.
Government announced a reduction in the effective VAT rate from 21.9% to 20%, adjustments to the VAT registration threshold from GH¢200,000 to GH¢750,000, and an extension of zero-rating on locally produced textiles until 2028 in the 2026 Budget presentation to Parliament.
Government maintains that these measures will help stimulate private sector expansion and ease cost pressures on both consumers and businesses.
