Ghana is a sub-Saharan African country with a population of approximately 27 million. It has seen tremendous progress in development and poverty reduction in the last two decades. The country knows a stark level of inequality though, particularly between people living in the south and north and between men and women. Over 70% of people in the northern regions live on less than $1 a day, compared to the national average of 28%.
In 2013 its GDP was estimated around 48 billion USD, with an annual growth of around 7%. The government debt as a percentage of GDP has reached 50% in recent years. Approximately 25% of its population falls below the national poverty line in 2012. The unemployment rate amounted to 4.6% in 2013.
The tax-to-GDP ratio has been approximately 15% over recent years. Tax policies remain largely revenue driven with a focus on indirect consumer-based taxes. Partly because these are easy to collect and do not have pronounced political backlashes, but also because of the fact that Ghana has recently sought financial help from the International Monetary Fund (IMF), which has always insisted on lower tax rates on income and profits as a strategy for attracting foreign direct investment. Another main issue is corruption, which tends to reduce the tax potential and makes the country focus more on indirect taxes, which are less vulnerable to corruption if supervision is strong.

CRAFT Country Strategy

CRAFT partners’ research on the taxation system in Ghana provided an outline of the main bottlenecks and challenges in the current tax system. It also assessed the capacity of the Ghana Revenue Authority (GRA), examined the potential of more progressive taxation practices and considered the linkages between taxation, good governance and Civil Society Organization (CSO) participation.

Strategy 2015-2018

Our research has shown that Ghana has a high potential for the use of direct tax or taxes on income, wealth and property, however, the political focus on Foreign Direct Investment (FDI), the promotion of private sector growth and employments, and the ongoing corruption are standing in the way of development in this direction. We are planning to undertake a more in-depth and technical analysis of the impact of tax concessions, corruption and strong focus on indirect taxes and seek to compute the amount of lost revenue as a result of these practices.
Our main lobby targets will remain the Tax Policy Unit of the Ministry of Finance and the GRA. We will continue to work with the Tax Justice Platform in Ghana through education and training in order to equip them with the necessary knowledge and analytical skills to increase pressure on the government and tax policy makers regarding current tax issues that need to be addressed.

Lead Organization

Ghana Integrity Initiative (GII) is a non-partisan, non-profit civil empowerment organization focused on the delivery of essential themes necessary for the creation of a National Integrity System. GII implemented an International Tax Compact (ITC) funded project, the scope of which comprised a Baseline study, a Needs assessment, a Tax Policy Reform study, a Training on Tax and finally a Civic Education Strategy Meeting.