Consumers in Ghana may soon experience higher prices for certain goods and services due to the implementation of new tax measures by the Ghana Revenue Authority (GRA) on July 1.
A significant aspect of these changes is a revised tax system aimed at informal sector workers, such as traders, which includes a 5% excise tax on locally manufactured plastic products and a 15% tax on non-life insurance premiums.
Although the local currency has remained relatively stable in recent months—providing temporary relief through reduced prices—this situation may not last long.
Plastic manufacturers have already indicated their plans to transfer the entire burden of the new 5% excise tax onto consumers.
“This 5% excise tax is fundamentally a consumer tax, meaning the consumer will bear the full impact,” stated Ebbo Botwe, President of the Plastic Manufacturers Association.
“We have been attempting to engage with the government because if consumers vanish, our business will also disappear.”
These price increases may soon be reflected in daily expenses, including meals from local food vendors.
“If prices rise, I will have to raise my food prices as well. I may need to add one cedi per plate,” remarked food vendor Solace Mensah.
Another vendor, Vital Naa Yateley Boys, shared similar worries:
“We cannot absorb the costs. We will need to charge two cedis more just to survive.”
Under the revised tax system, informal sector workers earning less than GHS 20,000 per year will now be subject to a fixed quarterly tax of either GHS 25 or GHS 45.
At the Abeka Market, some traders are advocating for adjustments to the tax rates based on shop size and daily sales.
“They should evaluate our inventory and daily sales before determining tax rates. A flat fee is not equitable,” said trader Samuel Apau.
Tax analyst Francis Timore Boi supports the initiative but raised concerns about the timing.
“With only six months remaining in the year, the government may struggle to achieve its revenue goals. Public education is crucial for ensuring effective compliance,” he noted.
He further emphasized the importance of broadening the income:
“If we can encourage a greater number of individuals to contribute equitably, we may be able to lower the overall tax rate from 25% to 20%. This is a commendable policy—though delayed, it is better late than never. It offers a significant opportunity for the fiscal stability of Ghana.”.
