Major Tax Relief for Ghanaians: New VAT Reforms Kick In with Big Savings from January 1, 2026

Good news for households and businesses—sweeping changes to Value Added Tax (VAT) and related levies have officially started on January 1, 2026, putting more money back in people’s pockets.

The Ministry of Finance says these reforms will ease the tax burden and help the economy grow. Key changes include:

• The COVID-19 Levy has been completely scrapped, saving individuals and businesses around GH¢3.7 billion in 2026 alone.
• The standard VAT rate has been cut to 20% to make everyday goods and services cheaper for consumers.
• The GETFund and National Health Insurance Levy (NHIL) are now input-output deductible, meaning businesses can claim them back. This is expected to reduce the cost of doing business by about 5%.
• Small businesses selling goods now only need to register for VAT if their yearly turnover is over GH¢750,000—much higher than the old limit of GH¢200,000. This lets many smaller traders avoid VAT paperwork.
• The VAT Flat Rate Scheme, which applied a simple 3% rate to some businesses, has been abolished and replaced with a single, clearer VAT system for everyone.

In total, the government estimates these changes will return nearly GH¢6 billion to households and businesses this year alone.

Officials describe the reforms as a key part of efforts to reset the economy, create more jobs, boost growth, and make life more affordable for Ghanaians.