The Ghana Revenue Authority (GRA) is set to introduce a simplified tax regime for informal sector workers starting July 1, in a major move to expand the country’s tax net and improve compliance.
The new system targets individuals operating outside the formal tax bracket, particularly those whose annual turnover falls below GHS 20,000. These individuals will now be required to pay a fixed quarterly tax ranging between GHS 25 and GHS 45.
Unveiling the plan during the launch of a research report titled “Ghana’s Untapped Economy: Analysis of Tax Compliance Behaviour of Informal Sector Workers in the Greater Accra Region,” GRA’s Assistant Commissioner for Research and Policy, Dr. Alex Kombat, said the initiative is designed to enhance fairness and efficiency in revenue collection.
“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 emphasized that the reform is intended to simplify tax obligations for small-scale operators while helping the government broaden its domestic revenue base. He urged media organizations and the general public to support the rollout.
The launch event was organized by BudgIT Ghana in collaboration with the Society for Women in Taxation Ghana and the International Budget Partnership (IBP). Findings from the report showed that informal workers often feel more at ease paying levies to local assemblies than engaging directly with national tax authorities.
BudgIT Ghana’s Country Manager, Jennifer Moffatt, echoed the need for greater synergy between the GRA and local government structures.
“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.
Esi Sam, Chairperson of the Society for Women in Taxation, welcomed the modified tax system and underscored its potential to make tax compliance less daunting for small operators.
“When you understand something, it becomes easy to do because it’s straightforward. So, if the modified taxation system is being introduced, it’s a good move—it will simplify the process and make it easier for people to understand,” she said.
The initiative marks a key step toward formalizing Ghana’s largely untaxed informal economy, which accounts for over 70 percent of the country’s workforce.
