GRA announces changes, including a reduction in the VAT rate, the elimination of the flat rate plan, and the elimination of the COVID fee as of January 1.
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With a drop in the standard rate and the elimination of various ancillary levies, the Ghana Revenue Authority (GRA) has presented a thorough overhaul of the country’s Value Added Tax (VAT) system, which will go into effect at the beginning of the new year.
Following the enactment of the Value Added Tax Act, 2025 (Act 1151), the GRA explained the major changes in an official message to all VAT-registered taxpayers. A straight reduction in the core VAT rate is one of the most effective approaches.
“The VAT rate has been reduced to 20 percent to ease the tax burden on households and businesses,” said the GRA
The registration threshold for companies that deal in goods has been significantly raised, which is a significant change for small and medium-sized firms.
The notice indicated that “the threshold for VAT registration for businesses who deal in goods has been increased from GH¢200,000 to GH¢750,000,” which is anticipated to deregulate thousands of smaller vendors.
Additionally, several levies that were implemented in recent years are eliminated by the amendments. The announcement stated that “the COVID-19 Health Recovery Levy has been abolished.”
In addition, the GRA declared “the re-coupling of NHIL and GETFund levies, to allow for input tax credit claims,” stating that “GETFund and NHIL levies will be treated as input tax deductions.”
The elimination of a distinct program for merchants is another important structural shift.
“The VAT Flat Rate Scheme (VFRS) has been abolished with the introduction of a unified and more transparent VAT structure,” according to the GRA.
The GRA states that the “effective implementation of the VAT Act is January 1, 2026.” This means that the reforms will be implemented quickly.
The authority sent a notice to “the general public, particularly VAT Registered Taxpayers, Employers, Accountants, Auditors, Importers, Exporters, Clearing Agents and Tax Consultants,” stating that the changes are “designed to simplify the VAT system, promote equity, improve administrative efficiency, and encourage voluntary tax compliance.”
The GRA has recommended that the public use the toll-free lines, WhatsApp numbers, and email address offered or get in touch with their local Taxpayer Service Centre for more information.
The Commissioner-General had the authority to issue the notification.
Source: newsthemegh.com
