Here are the Proposed Tax Measures in the 2023 Budget
Revision of excise tax on cigarettes and tobacco products to reflect ECOWAS protocols (the ECOWAS protocol requires $0.02 dollars per cigarette or not less than 50% ad valorem rate).
The finance minister of the Republic of Ghana presented the budget statement to parliament on the 24/11/2023.
Below are the list of tax measures in the fiscal policy for 2023.
1. Introduction of withholding taxes on winnings from betting
2. Reintroduction of road tolls
3. 2.5 % increase in VAT to 15% (with the decoupled system in place, the effective rate will be 21.9%)
4. Vehicle Income Tax and Income Tax Stamp to be reviewed and increased
5. Upper limit of the graduated rate for personal income tax has been increased to 35%.
6. Introduction of withholding tax on gains from realization of assets and liabilities
7. The optional 15% rate for individuals for gains on realization to be reviewed( increasing the rate)
8. 1% concessional rate for entities enjoying tax holidays has been increased to 5%.
9. Implementation of minimum chargeable income system for entities with concessional rate.
10. Loss carried forward provisions are to be unified (used to be 5 years for entities in priority sectors and 3 years for other entities).
11. Deductibility of foreign exchange losses to be restricted to actual losses.
12. Revision of excise tax on cigarettes and tobacco products to reflect ECOWAS protocols (the ECOWAS protocol requires $0.02 dollars per cigarette or not less than 50% ad valorem rate).
13. Introduction of taxation on electronic smoking devices.
14. Introduction of taxation on liquids which were not taxed.
15. Increase in excise tax on spirits above that of beers.
16. Full abolishment of the benchmark discount policy at the port.
17. Introduction of self clearing system at port (this will help track individuals who do not pay taxes since Tax Clearance Certificates will be needed before clearing).
18. National Fiscal Stabilization Levy will be converted to Growth and Sustainability Levy to cover all entities. Category A entities are to pay 5% on their profit before tax (Category A entities are those already paying the national stabilization levy and six new sectors to be included).
Category B entities are to pay 2.5% on their profit before tax (Category B entities are all other entities)
Category C entities are to pay 1% of their total production (Category C entities are those in the extractive sector: they still fall in Category A)
19. E-levy rate has been reduced to 1% with the removal of the daily GHS 100 threshold.
20. Exchange losses on Capital Assets are to be capitalized and not deductible.
21. Review of the exemption regime of the free zone entities.
22. Exclude unrealized exchange losses from deduction
23. Tax wavers are on hold.
24. Waiver of tax on withdrawals from tier 3 pension contribution for individuals who lose their job permanently within the 10 years window
