2026 VAT Reforms in Ghana: What Businesses Need to Know
What Has Changed and Why It Matters?
Ghana has introduced major changes to its VAT system starting from 1st January 2026. These reforms not only affect how businesses run, but also how consumers deal with prices. The reforms aim to make the tax system simpler, lower the VAT burden, and improve compliance.
What Has Changed?
One major change is the increase in the VAT registration limit from GH¢200,000 to GH¢750,000.. Businesses earning below this amount annually no longer need to register for VAT, easing compliance for small businesses.
The effective VAT rate has been reduced from 21.9% to 20%. Under the new structure, VAT (15%), NHIL (2.5%), and GETFund Levy (2.5%) are all charged directly on the overall amount. The previous system of charging VAT on top of NHIL and GETFund has been removed. In addition, the 4% Flat Rate VAT has been abolished, placing all VAT-registered businesses under a single, uniform rate.
The COVID-19 Health Recovery Levy has also been completely abolished, further reducing the VAT burden on businesses and consumers.
Another key change is that the GETFund and NHIL levies can be claimed back. These levies are now input-deductible , allowing businesses to offset them against output VAT. This lowers operating costs and improves cash flow.
Is the Impact Positive?
Overall, the reforms are largely positive. Most especially for small and medium-sized businesses. However, with the Ghana Revenue Authority improving digital VAT enforcement, accurate record-keeping and timely filing are now more important than ever.
Final Thoughts
The 2026 VAT reforms mark a major shift toward a simpler and more business-friendly VAT system. Understanding the changes is key to staying compliant and competitive. By preparing early, businesses can reduce costs, improve cash flow, and avoid penalties under the new system
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