Beginning July 1, 2025, the Ghana Revenue Authority (GRA) will roll out a modified tax system aimed at boosting tax compliance and expanding revenue collection within the informal sector.
The new framework targets informal sector operators who are not currently registered with the GRA and have annual sales below GHS 20,000. These individuals will be required to pay a fixed quarterly tax ranging from GHS 25 to GHS 45, depending on their income level.
The announcement was made during the launch of the final report on Informal Sector Tax Compliance Research, titled 鈥淕hana鈥檚 Untapped Economy: Analysis of Tax Compliance Behaviour of Informal Sector Workers in the Greater Accra Region.鈥 The report was released by BudgIT Ghana, in collaboration with the Society for Women in Taxation Ghana and the International Budget Partnership (IBP).
Speaking at the event, Dr. Alex Kombat, Assistant Commissioner for Research and Policy at the GRA, explained that the modified system is designed to broaden the country鈥檚 tax base and ensure greater equity in revenue mobilization.
鈥淲e鈥檝e introduced a system called modified taxation. For those earning below GHS 20,000 annually, a fixed tax鈥擥HS 25, GHS 35, or GHS 45鈥攚ill apply quarterly. For incomes between GHS 20,000 and GHS 500,000, a 3% tax on turnover will be imposed,鈥 Dr. Kombat stated.
He noted that the initiative represents a departure from traditional tax practices and is part of broader reforms aimed at formalizing the informal economy. He called on the public, particularly the media, to support awareness and compliance efforts.
Jennifer Moffatt, Country Manager at BudgIT Ghana, emphasized the importance of collaboration between the GRA and local governments to make the new system work effectively.
鈥淢any informal workers are more willing to pay levies to Metropolitan, Municipal, and District Assemblies (MMDAs) than to the GRA. A joint approach could improve collection and trust,鈥 she said.
Esi Sam, Chairperson of the Society for Women in Taxation, endorsed the initiative, highlighting its simplicity and potential to enhance voluntary compliance among informal workers.
鈥淧eople are more likely to comply when tax systems are simple and easy to understand. The modified system offers exactly that,鈥 she said.
The modified tax system is expected to provide a more inclusive approach to taxation in Ghana, helping to capture a larger share of revenue from the informal sector鈥攅stimated to make up over 70% of the country鈥檚 workforce.
The GRA is expected to intensify public education in the coming weeks ahead of the rollout to ensure widespread understanding and acceptance of the new system.