How Ghana Passed an Ambitious Alcohol Excise Tax Increase and What Comes Next

Journey towards the passage of the Excise Duty Amendment Act, 2023 specifically the alcohol tax increase

The Vision for Alternative Development, Ghana (VALD Ghana) has a strong track record of successful advocacy for the many public health intervention, particularly in prevention and control of tobacco and alcohol in Ghana. More specifically, VALD Ghana has successfully championed the National Alcohol Policy. It was adopted in 2016. Currently VALD is working closely with other CSOs to finalize the National Alcohol Regulations.

Unfortunately, throughout those years commitment by the Ministry of Finance to amend the Excise Duty Act to increase taxes on alcohol and tobacco products was virtually absent despite advocacy efforts led by VALD Ghana.

This changed recently, however, and in 2023, through continued and sustained advocacy efforts led by VALD Ghana, the 2023 Budget Statement included an amendment to increase taxes on some alcohol products.

Our advocacy activities included:

1. We convened national Stakeholder meetings which brought together key alcohol policy actors from the government, civil society, academia, youth and women groups and the media. The meetings set the pace for advocacy towards changing the tax structure and for championing tax increases on health harming products, with presentations from the Ghana Revenue Authority (GRA), Food and Drugs Authority (FDA), Ministry of Finance (MoF), Ministry of Health (MoH) and civil society actors in alcohol control and taxation. These presentations focused on their respective institutional viewpoints. A plan of action was also developed, and commitments were made to ensure that the objectives set in the proposals would be met.
2. VALD Ghana made efforts to form a network called the “Tax Advocacy Network for Health Promotion” made up of mainly CSOs partners working on alcohol, tobacco, health promotion, NCDs, tax and finance, economy etc. to support the tax advocacy on health harming products. The network with support of VALD Ghana developed policy briefs, statements, and technical briefs. We also conducted one on one advocacy meetings and engagements. And we took part in TV and radio interviews to drive the public discourse and represent the public support for alcohol and tobacco taxes.
3. We produced a study entitled “Situational Analysis of Alcohol Use in Ghana”  in close collaboration with the Ghana NCD Alliance. This study helped us to advance the advocacy effort toward alcohol control and taxation. The alcohol report was officially launched by the Deputy Minister of Health with massive participation from major alcohol policy stakeholders – the Ministry of Health, Food and Drugs Authority, Ministry of Finance, Members of Parliament, Mental Health Authority, Ghana Revenue Authority, CSOs partners and a wide representation of the media.
4. Beyond the launch, a series of engagement meetings (in person) were held with tax officials from the Ministry of Finance’s Tax Policy Unit (TPU) as well as the customs division of the GRA which is directly involved in the taxation of imported alcoholic products. In each of these meetings, VALD Ghana, explained the importance of excise taxes on alcohol. I had the privilege of leading this work, supported by local, national, and global partners. I would make the case that raising alcohol excise taxes will reduce the affordability, accessibility and exposure to kids and young people, reduce the noncommunicable disease (NCDs) burden in Ghana and improve health and wellbeing for our people.
5. To make a better case for alcohol taxes, we strategically embedded alcohol and sugar sweetened beverages taxation in our tobacco tax advocacy work. We held National Stakeholders meeting to discuss the urgent need for the Ministry of Finance to prioritize increasing taxes on all three health-harming commodities. All stakeholders including the Ministry of Health and Parliament representatives present pledged to support the proposal. The Ministry of Finance and the Ghana Revenue Authority pledged to include the excise tax increase in the 2023 Budget Statement.
6. It was important for us to focus on meaningful involvement of people living with NCDs in the process; they held regional engagement meetings with their respective members of parliaments to gain their support and buy-in for the passage of the alcohol regulations and taxes on alcohol products when the bill was tabled in Parliament.
7. The Ministry of Finance during the National Multi-Stakeholders consultation extended an invitation to VALD Ghana. It was my honor to make a presentation – speaking about the harm of consuming alcohol and tobacco and other health-harming products and the huge revenue benefits to Ghana and our people.

Other activities that supported the movement towards raising alcohol taxes included:

The International Monetary Fund held consultations through the Economic Governance Platform where I was able to represent VALD. I delivered a presentation on the importance of excise taxes from increased revenue and health benefit perspectives.

The WHO and UNDP held meetings in Ghana where I was invited to speak on behalf of VALD Ghana. In those interventions I focused on the need for Ghana to adopt a mixed system or a specific tax and the importance of the triple win effect from alcohol excise tax increases: reducing alcohol use, harm, and costs; increasing government revenue for investment in pro-social and pro-health programs; and promoting equity and development for all because these tax increases would benefit the most vulnerable the most.

VALD Ghana, together with the WHO, the FCTC Secretariat, UNDP, REED, the UN interagency Taskforce on NCDs developed a joint report titled, “Health Taxes in Ghana” to support the advocacy with key recommendations on tax increases on alcohol, tobacco and SSBs.

Presentation of Ghana’s 2023 Budget Statement to Parliament and VALD Ghana’s Advocacy 

After all these advocacy efforts, social mobilization, and producing key material and reports, finally, the Minister of Finance presented to parliament on November 24, 2022, the 2023 Budget statement. It included the shift from the current ad valorem to a mixed system and it included the increase of taxes on some alcohol products, specifically wine and spirit.

The reports on the “situational analysis of alcohol use in Ghana” and the “Economics of Tobacco Control/Taxation in Ghana” played an important role.

Parliament on recess for Christmas holidays 

Knowing what could happen during the period with respect to alcohol industry interferences, we and our CSOs partners, held a press conference together with allied government institutions on Thursday, February 23, 2023, to draw attention of the legislature, on the urgency to pass the excise tax amendment bill that was in Parliament at the time.

The objective of the press conference was to reiterate the urgent need for parliament to pass the Bill as it is and to ensure its effective implementation. With our strategic press conference, we also sought to expose the industry’s interference. This generated a lot of media coverage and headlines for a sustained period.

The industry and their allies, labor unions, and Association on Ghana Industries and many others also weighed in vehemently.

We saw a couple of news items where the industry was calling on Parliament to scrap the tax or review downwards the proposed taxes.

We had massive media coverage and interviews afterward which made us hopeful that momentum would continue till the Bill would be passed eventually.

Info box: press coverage

• Ghana Business News: “CSOs ask Parliament to pass Excise Duty Amendment Bill to avert diseases and deaths”
• Modern Ghana: “Expedite passage of Tobacco Excise Duty Amendment Bill to save lives, boost revenue – VALD-Ghana to Parliament”
• News Ghana: “VALD-Ghana urges government to pass Excise Duty Amendment Bill”
• Ghana News Agency: “Parliament urged to pass excise duty amendment bill”

Opposition from industry players and some media houses was massive

The alcohol tax increase faced massive opposition from the alcohol industry and those that do the dirty work for alcohol companies. Their whole argument was centered on revenue mobilization with little attention to the health benefits of excise tax.

We had to respond often and swiftly to increase our social media and our traditional media presence with press releases and statements. We also made it an emphasis to develop some key short briefs on the health benefits of the excise taxes and shared those widely to our CSOs partners and the MPs to support the bill and to neutralize alcohol industry claims.

The alcohol excise tax increase also faced open opposition from some MPs. Alcohol industry lobbyists were making false claims about economic hardship, job loss, collapse of business and more to derail the alcohol excise tax increase.

At the time, we did not get nearly as many TV interviews compared with the alcohol industry, so we used social media and one on one engagements – arguing from the standpoint of public health and the people in our country. We exposed that the argument for excise tax from health angle was completely missing when the topic was discussed with alcohol industry lobbyists.

Passage of the Excise Tax Bill 

The Excise Duty Amendment Bill was passed on Friday, March 31, 2023, against stiff opposition from alcohol industry lobbyists and some Minority MPs.

Even though the bill was passed, I felt it was a sad moment for some of us especially because the bill went through votes before it was passed. They only argued from economic / business hardship perspectives repeating (false) alcohol industry talking points, despite the public health grounds that CSOs had repeatedly highlighted in press releases, advocacy meetings, and media engagements.

The Speaker of Parliament was awesome on the day, and we really appreciate his leadership.

You can watch the proceedings here. The excise discussion started about an hour after the proceedings commenced.

VALD Ghana’s advocacy for the Signing of the Bill by the President and fierce industry opposition

The bill was passed but the alcohol industry still attempted to derail the tax increase. The final stage was for the President to assent to the Bill so it could become a full-fledged Act. The industry petitioned the President over job loss and unemployment. The industry also claimed that no consultation before the bill was carried out and Big Alcohol appealed to the president not to sign the bill.

Signing of the Excise Duty Amendment Bill into an ACT 

Finally, the president signed the Bill amidst pressure from the industry and CSOs consistency and sustained advocacy targeting key players including the President, the Speaker of Parliament, Key Ministries, and agencies -MoF and MoH, GRA and FDA finally bore fruit.

Challenges we faced

The tax advocacy campaign faced huge and fierce opposition from the alcohol, tobacco and SSBs industries all together. They took advantage of the current economic difficulties, including unemployment, collapse of businesses, revenue loss and more.

Another serious challenge was that we had very little support from a section of the media. Especially the TV granted more interviews with the industry players/labor unions etc.

VALD Ghana had to rely on awareness campaigns, policy briefs, short messages to Parliamentarians, social media targeting policy makers and parliamentarians, the presidency, the speaker of parliament and other political leaders. We must demand for equal attention and media space.

Eventually, we got some media traction and made the argument in favor of public health and the protection of young people from alcohol harm through increased alcohol taxes.

What does the alcohol tax increase look like in practice?

The alcohol taxes are aimed at raising revenue to government and discourage alcohol use especially among young people and children. The excise tax is pure ad valorem and based on the ex-factory price.

The below are the specific percentages of taxes imposed on different alcohol products:

Beer, stout, other than indigenous beer:

• Percentage use of local raw material
  • (a) Less than 50 per centum of 1ocal raw material will attract 47.5 per centum of the ex-factory price
  • (b) 50 per centum to 70 per centum of local raw material will attract 32.5 per centum of the ex-factory price
  • (c) Above 70 per centum of 1ocal raw material will attract 10 per centum of the ex-factory price

Cider beer will attract 20 per centum of the ex-factory price

Wines including sparkling wine will attract 45 per centum of the ex-factory price

Spirits including ‘Akpeteshie‘:

• (a) Distilled or rectified will attract 50 per centum of the ex-factory price
• (b) Blended or compounded will attract 50 per centum of the ex-factory price
• (c) Other:
  • (i) For use so1e1y’ in laboratories or in the compounding of drugs will attract 0 per centum
  • (ii) Denatured to the satisfaction of the Commissioner-General will attract 10 per centum of the ex-factory price
  • (iii) ‘Akpeteshie’ will attract 20 per centum of ex-factory price

Opportunities and next steps

The excise act will reduce consumption, reduce exposure of alcohol to children and young people, and will generate sustained revenue to our government. The passage gives an opportunity to advocate for earmarking a portion of the taxes to support health promotion, and NCDs prevention and control interventions, including rehabilitation, cessation and more.

We now also can take the next step and develop an alcohol tax modelling to advance a more comprehensive tax reform on alcohol products.

On the technical level, an important next step is to provide proper support through regular training and sensitization of tax and customs officials to update them on the new taxes and ensure full implementation.

We will work with monitoring progress of the implementation of the health taxes and provide recommendations to improve revenue mobilization and promote health and development in Ghana.

It is now crucial to assess the baseline situation of the alcohol taxes to inform a post assessment. This will help measuring progress and to make evidence-informed recommendations including reviewing the alcohol tax structure.

Beyond these concrete, practical, and technical opportunities, and next steps, I see two major ones for the path ahead:

We can further build on the work by stepping up efforts to increase awareness about health taxes particularly on alcohol and other health harming products among the policy makers, the media, and the public.

This success in overcoming alcohol industry opposition and to ensure decision-makers focus on doing right by the people through raising alcohol taxes is a great opportunity to build on the momentum toward the passage of the alcohol regulations.

Selection of news media reporting

About alcohol industry opposition to the alcohol excise tax increase

Ghana Web: “Industry appeals to Parliament against passage of 20% excise tax“

OPR: “Parliament must reject two new tax bills – IEAG“

AmCham Ghana: “AmCham Ghana Statement On Excise Duty (Amendment) Bill 2022 Before Parliament”

Link to industry petition 

Business Ghana: “Federation of Labor petitions Parliament over proposed Excise Tax Bill”

Ghana Business: “Two organizations appeal to President not to assent three revenue bills“

Link to CSOs press statements and TV discussion

News Ghana: “CSOs call on Parliament to pass Excise Duty Amendment Bill“

Ghana News Online: “Parliament must Choose Public Health and Pass the Excise Tax Bill Now!”

Modern Ghana: “Expedite passage of Tobacco Excise Duty Amendment Bill to save lives, boost revenue – VALD-Ghana to Parliament”

VALD Ghana and other CSOs held a press conference calling on the President to sign the Bill for public Health and revenue gains

Ghana Business News: “CSOs appeal to President to sign Excise Duty Amendment Bill into law“

CSOs appeal to President to sign Excise Duty Amendment Bill into law | Ghana News Agency https://gna.org.gh/2023/04/csos-appeal-to-president-to-sign-excise-duty-amendment-bill-into-law/

Flipboard: “Sign Excise Duty Amendment Bill into law – CSOs appeal to President“

Signing of the Excise Duty Amendment Bill into an ACT 

Ghana Web: “Akufo-Addo has signed three new tax bills into law – Information Minister”

My Daily News Online: “CSOs Hail Prez Akuffo Addo for signing Excise Duty Amendment Bill 2022 into law“

Capital News Online: “CSOs applaud Prez Akuffo Addo for signing Excise Duty Amendment Bill 2022 into law“

By Labram Musah Massawudu

The Writer is a public health advocate with interest in tobacco and alcohol control, road safety and NCDs, as well as development in general.

Labram is the Executive Director of Programs at Vision for Alternative Development (VALD) in Ghana. He also serves as National Coordinator of the Ghana NCDs Alliance. Labram is a member of the International Board of Movendi International.