The Ghanaian government is taking bold steps to revamp the energy sector and relieve debt burdens, while also securing a reliable power supply for industries. One of the measures being implemented involves quarterly tariff increments, in line with the IMF’s revenue mobilization objectives.
To achieve its revenue goals, Ghana has unveiled a comprehensive Medium-Term Revenue Strategy, focusing on crucial tax policies and revenue administration measures. The aim is to meet both domestic revenue targets and the IMF’s program revenue objectives.
Ghana has already made significant strides in revenue generation, with measures such as quarterly adjustments to electricity tariffs, raising the VAT rate from 12.5% to 15%, and restructuring the E-levy, among others. Looking ahead to 2024, the government plans to introduce 12 tax reforms and new tax mechanisms, including the removal of selected VAT exemptions amounting to approximately GHS4.4 billion.
The government also aims to expand taxes on gambling revenues, revise income-based taxes, and scrutinize the headline rate of the Communication Services Tax (CST). Additionally, there will be a focus on strengthening the implementation of the Vehicle Income Tax (VIT) sticker mechanism and reforming corporate income tax by phasing out tax holidays and exemptions.
Importantly, these measures are part of the government’s independent revenue mobilization strategy, not dictated by the IMF. As Ghana navigates these reforms, stakeholders and citizens will closely observe the impact on various sectors and the overall economic trajectory.
