Ghana is losing an estimated 60% of its potential Value Added Tax (VAT) revenue due to non-compliance and weaknesses within the tax collection system, Finance Minister Dr. Cassiel Ato Forson has disclosed.
According to the Minister, the situation is unacceptable and requires urgent action to protect the country’s tax base.
Presenting the 2026 Mid-Year Budget Review in Parliament on Thursday, July 23, Dr. Forson appealed to Parliament to support government’s efforts to improve VAT collection and address revenue leakages.
He warned businesses and individuals who collect VAT from customers but fail to remit it to the state, saying such practices must end.
“It cannot continue. I call on Parliament to support Government to crack down on businesses and individuals who collect VAT from taxpayers and keep it instead of remitting it to the state,” Dr. Forson stated.
The Finance Minister announced that government is introducing physical electronic devices to strengthen VAT monitoring and improve compliance among businesses.
He explained that the devices will help track taxable transactions, reduce revenue losses and ensure that businesses properly account for VAT collected.
“Physical electronic devices will help improve VAT collection, reduce revenue leakages and ensure that businesses account properly for VAT they collect,” he said.
Dr. Forson added that the pilot phase of the electronic VAT monitoring devices is at an advanced stage and will soon support efforts to modernise tax administration.
As part of measures to encourage compliance, government will also introduce a VAT reward scheme that will allow customers who request valid VAT invoices to qualify for periodic rewards.
The Minister said the initiative is aimed at involving citizens directly in protecting the country’s revenue system.
“This is how a tax culture is built not through fear but through participation, transparency and reward,” he noted.
