Economist projects VAT hike to 18% in 2025 budget

Economist Professor Godfred Bokpin anticipates a rise in Ghana’s Value Added Tax (VAT) to 18% or slightly lower in the 2025 budget as the government seeks to offset revenue losses from scrapping the E-Levy, COVID-19 levy, and betting tax.

Speaking to Citi Business News, Prof. Bokpin suggested that the government may extend VAT to financial services and merge standard levies with the standard VAT rate to streamline taxation.

He warned that exceeding 18% could hurt productivity and low-income earners, stressing the need for reforms that balance private sector expectations, public service delivery, and procurement efficiency.

As President Mahama's administration prepares its first budget, it aims to cut wasteful spending, enforce fiscal discipline, and reset the economy while addressing concerns about revenue generation.