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Changes to VAT and e-levy rates effected and benchmark discount value policy reversed

Following the Ghanian government’s announcement of various indirect tax policy changes in the 2023 budget statement, the Value Added Tax (Amendment) (No.2) Act, 2022 (Act 1087) and the Electronic Transfer Levy (Amendment) Act, 2022 (Act 1089) have been passed, bringing into effect changes to the VAT and electronic transfer levy (e-levy) regimes in Ghana. The acts were published in the official gazette on 29 December 2022 and take effect as from 1 January 2023. In addition, the GRA has published a public notice announcing the abolition of the benchmark value discount policy (BVDP) on imported goods. 

This article provides a summary of the important provisions in both the acts and the public notice, and their potential impact on taxpayers. 

Value Added Tax (Amendment) (No.2) Act, 2022 (Act 1087) 

Revision of VAT rate for standard rate scheme 

Act 1087 has revised the standard rate of VAT to 15% from 12.5%, and therefore taxable suppliers registered under the standard regime now are required to charge the increased rate on the value of their taxable supplies. VAT is charged together with the national health insurance levy (2.5%), the Ghana education trust fund levy (2.5%), and the COVID-19 health recovery levy (1%). The effective VAT rate including all applicable levies has therefore increased to 21.9% from 19.25%.

Taxpayers registered under the VAT flat rate scheme continue to charge VAT at a flat rate of 3%, plus the 1% COVID-19 health recovery levy. 

Penalty for noncompliance with invoicing requirements 

As from 2022, taxpayers must use a certified invoicing system (CIS) to raise VAT invoices through an approved electronic system. A taxpayer’s chosen invoicing system must be certified by the commissioner-general of the GRA and is integrated into the national invoicing system. 

The amendment under Act 1087 provides a specific penalty for VAT registered businesses that fail to comply with the requirements of the CIS. Failure to issue an appropriate tax invoice or sales receipt, tampering with the CIS, or failure to integrate the taxpayer’s invoicing system into the national invoicing system may result in a penalty of the higher of GHS 50,000, or three times the amount of tax involved. This penalty must be paid in addition to any penalty for failure to issue a tax invoice under the VAT Act. 

Revision of VAT exempt supplies 

Act 1087 has expanded the scope of VAT exempt supplies in Ghana to include the acceptance of a wager or stake in any form of gaming or betting. Taxpayers engaged in the gaming or betting business, including lotteries and the provision of gaming machines, no longer are required to charge VAT on stakes placed by their customers. 

In addition, Act 1087 has excluded the supply of imported textbooks and other imported educational printed materials from the ministry of education’s textbook and stationery VAT exemption list, meaning they are now subject to VAT. 

Electronic Transfer Levy (Amendment) Act, 2022 (Act 1089) 

Act 1089 has reduced the e-levy rate to 1% of the value of electronic transfers, from 1.5%. Notably, Act 1089 did not make any change to the daily threshold of GHS 100 for electronic money transfers, and GHS 20,000 for bank transfers through instant pay digital platforms, as initially proposed in the government’s 2023 budget statement. The reduction in the rate of the e-levy is expected to reduce the cost of electronic payment services to final consumers. 

Act 1089 also introduces an obligation for entities subject to the levy to file a return with the commissioner-general in the manner and at the time to be determined. Taxpayers must pay the amount of the levy to the tax authorities within 24 hours of charging the levy on an electronic transfer. 

Reversal of the BVDP 


The BVDP was introduced to make Ghanaian ports competitive, reduce smuggling, and increase government revenue. In 2022, the BVDP provided a 10% discount on the home delivery value (HDV) of vehicles and a 30% discount on the delivery or benchmark values of all other imports. Following an announcement in the 2023 budget statement that the discount was to be phased out, the commissioner-general issued a public notice on 22 December 2022 announcing the abolition of the BVDP. 

Scope of the change 

As from 1 January 2023, no discount is offered on the benchmark value of all imports. Import duty assessments are based on the total HDVs, benchmark values, or free on board (FOB) values, subject to the GRA’s existing risk management procedures. 

Transitional arrangements 

Given the immediate nature of the revision, certain transitional rules have been put in place to mitigate the effect on transactions spanning the date of the change, including: 

  • Consignments unloaded on 31 December 2022 from ships, aircraft, or vehicles may clear import controls without being affected by the reversal, under a free storage period.
  • Where a pre-arrival declaration has been processed, and any tax paid, prior to 1 January 2023, the import is not affected by the new rules, even if the goods arrive on or after that date.
  • Any bill of entry (BOE) with tax paid before 1 January 2023, but undergoing post-entry declaration without any changes that would affect the tax amount paid, will not be affected.
  • Any BOE that has been assessed or accepted, but where the tax has not been paid before 1 January 2023, will undergo reprocessing to reverse the discount applied to the valuation. 

Deloitte Ghana comments

The abolition of the BVDP means that 100% of the value of imports is used as the base for assessing customs duties. This is expected to increase the cost of imports and may directly affect the general price of goods in Ghana. Coupled with the global increase in prices, and fluctuating foreign exchange rates, businesses may wish to consider enhancing compliance processes to mitigate any tax loss, and implement cost optimization strategies such as a review of supply chain processes to reduce costs and remain competitive.

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