Ghana, Minister of Finance designate, Dr. Cassiel Ato Baah Forson, has pledged to undertake comprehensive reforms in the implementation of the Value Added Tax (VAT). This announcement comes as a response to concerns raised by the business community regarding the chaotic and distorted VAT regime.
During his appearance before the Appointments Committee of Parliament, Dr. Ato Forson acknowledged the unpredictable tax policy and administration, which has been a major challenge for businesses. He assured that the government will conduct a thorough review of Ghana’s VAT regime, as outlined in the National Democratic Congress (NDC) manifesto.
The proposed reforms aim to provide relief to households and businesses by adhering to the underlying principles of VAT. This includes abolishing the Covid Levy, reversing the decoupling of GETFund and NHIL from the VAT, and reducing the effective VAT rate. Additionally, the government plans to reverse the VAT flat rate regime, adjust the VAT registration threshold to exempt micro and small businesses, and improve compliance through public education and awareness.
These reforms are expected to simplify and transparentize the tax regime, making it easier for businesses to operate and thrive in Ghana. As the government moves forward with these reforms, businesses can look forward to a more favorable and predictable tax environment.
Ruth Abla ADJORLOLO