GRA confirms January 1, 2026 start date for new VAT regime

The Ghana Revenue Authority (GRA) has confirmed that the effective implementation date of the Value Added Tax Act, 2025 (Act 1151), will be January 1, 2026, giving businesses and taxpayers a period to prepare for sweeping reforms in the country’s VAT regime.

In a public notice to VAT-registered taxpayers and the general public, the Authority said the new law introduces significant changes aimed at simplifying VAT administration, improving efficiency and promoting voluntary tax compliance.

The reforms are expected to reshape how VAT is charged, reported and credited across the economy.

One of the major changes under the new Act is the upward revision of the VAT registration threshold for businesses dealing in goods, which has been increased from GH¢200,000 to GH¢750,000.

This adjustment is expected to ease the compliance burden on smaller enterprises by excluding more micro and small businesses from mandatory VAT registration.

The GRA also announced the abolition of the COVID-19 Health Recovery Levy, removing an additional layer of consumption tax that had been in place since the pandemic.

In addition, the re-coupling of the National Health Insurance Levy (NHIL) and the Ghana Education Trust Fund (GETFund) levies will allow businesses to claim input tax credits.

Under the new VAT framework, the standard VAT rate has been reduced to 20%, a move the Authority says is intended to ease the tax burden on households and businesses.

The VAT Flat Rate Scheme has also been abolished, paving the way for a unified and more transparent VAT structure.

The GRA indicated that the reforms are designed to promote equity in the tax system, enhance administrative efficiency and strengthen compliance among taxpayers.

Employers, accountants, auditors, importers, exporters, clearing agents and tax consultants are being urged to familiarise themselves with the changes ahead of the January 2026 rollout.

The Authority has encouraged taxpayers seeking clarification to engage with its Taxpayer Service Centres or use its toll-free and digital support channels as preparations begin for the implementation of the new VAT Act.