The Ghana Revenue Authority (GRA) has announced a 15% Value Added Tax (VAT) on non-life insurance premiums, effective July 1, 2025.
The new tax will apply to policies covering areas such as property, health, and travel—but notably, motor insurance will remain exempt.
The policy, which forms part of measures outlined in the 2025 national budget, is expected to widen the country’s tax net and boost revenue for public services.
For businesses and individuals, this means higher premiums on non-life insurance products. Consumers seeking coverage in sectors like property, health, or travel may now pay more, potentially pushing some to reconsider or reduce coverage levels.
While the move may strengthen government revenue, it could also place an added financial burden on households and SMEs already navigating a high-inflation environment.
GRA to roll out modified tax system for informal sector on July 1
Beginning July 1, the Ghana Revenue Authority (GRA) will introduce a modified tax system aimed at improving tax compliance and revenue collection from the informal sector.
Under the new framework, informal sector workers not currently registered with the GRA, but earning annual sales below GHS 20,000, will be required to pay a fixed quarterly tax between GHS 25 and GHS 45.
Speaking at the launch of the final report on Informal Sector Tax Compliance Research titled: “Ghana’s Untapped Economy: Analysis of Tax Compliance Behaviour of Informal Sector Workers in the Greater Accra Region” by BudgIT Ghana in partnership with Society for Women in Taxation Ghana and the International Budget Partnership (IBP), the GRA’s Assistant Commissioner for Research and Policy, Dr. Alex Kombat explained that the revised system seeks to broaden Ghana’s tax base and promote fairness in revenue mobilization.
“We have developed a system called modified taxation. Those with turnover below GHS 20,000 will pay a fixed amount—GHS 25, GHS 35, or GHS 45. For those with turnover between GHS 20,000 and GHS 500,000, we’ll apply a 3% tax on their turnover. This marks a shift from the traditional tax collection methods,” he stated.
Dr. Kombat added that the initiative is expected to launch by July 1 and appealed for public support, especially from the media, to ensure its successful implementation.
The Country Manager at BudgIT Ghana, Jennifer Moffatt, stressed the importance of collaboration between the GRA and local authorities to enhance tax collection in the informal sector.
“One of our key recommendations is for the GRA and Metropolitan, Municipal, and District Assemblies (MMDAs) to collaborate on tax collection. Many informal sector workers feel more comfortable paying levies to local authorities than to the GRA,” she noted.
Chairperson of the Society of Women in Taxation, Esi Sam endorsed the initiative, stating that it will simplify tax compliance for informal sector workers.
