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Ghana Indirect Tax Updates

The Ghana Revenue Authority has recently issued three Practice Notes to address various issues in the Value Added Tax (VAT) Act, 2013 (Act 870). The Practice Notes cover conditions for granting exemption for Civil Engineering Public Works, treatment of exempted imported goods supplied within Ghana, and treatment and documentation requirements for sales to and from the free zones.

Practice Notes are generally intended to achieve consistency in the administration of tax laws and provide guidance to tax officers, consultants, and taxpayers. We therefore expect the Practice Notes to enhance the administration of VAT in these areas and shed light on some of the grey areas that have bedeviled practice over the past few years.

In this Tax Update, we provide highlights of the key provisions of the Practice Notes as well as a recent directive requiring VAT invoices for corporate tax deduction to guide businesses plan for the implications of these developments in Ghana.