2026 Budget: Government Abolishes COVID-19 Levy
Finance Minister unveils sweeping VAT reforms, boosts household incomes, and charts Ghana’s path from recovery to transformation
- COVID-19 Health Recovery Levy abolished
- Comprehensive VAT reforms introduced
- 2026 Budget aims to consolidate economic gains, accelerate transformation, and create jobs
Finance Minister Dr. Cassiel Ato Forson has unveiled the 2026 Budget, describing it as a bold step in Ghana’s journey toward economic renewal. The centerpiece of the budget is the abolition of the COVID-19 Health Recovery Levy, a pandemic-era tax that has long burdened households and businesses.
“We promised to abolish the COVID-19 Levy, and we have done it,” Dr. Forson told Parliament, adding that this single reform will return GH₵3.7 billion to individuals and businesses in 2026 alone.
The government says this injection will boost household incomes, reduce business operating costs, and support job retention, providing a much-needed stimulus to the economy.
Comprehensive VAT Reforms
The abolition of the COVID-19 Levy is part of a broader VAT reform package projected to deliver GH₵5.7 billion in benefits to the private sector and households. Key measures include:
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Input Tax Deductions on Levies: Businesses can now claim GETFund and NHIL levies as deductions, reducing costs by an estimated 5%.
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Reduced Effective VAT Rate: Lowered from 21.9% to 20%, easing the cost of goods and services.
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Raised VAT Registration Threshold: Increased from GH₵200,000 to GH₵750,000, benefiting thousands of SMEs.
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Targeted Industry Relief: VAT on mineral reconnaissance and prospecting abolished; zero-rating on locally manufactured textiles extended to 2028.
Dr. Forson said the reforms are part of a forward-looking strategy to stimulate growth, formalize businesses, and reduce the tax burden on citizens.
From Recovery to Transformation
Describing the 2026 Budget as the next phase of national renewal, the Finance Minister said it aims to consolidate gains, accelerate economic transformation, and ensure inclusive prosperity.
“This budget moves Ghana from recovery to transformation and from promises to progress. Ghana is back, strong, and full of hope,” he said.
The Finance Minister highlighted Ghana’s macroeconomic achievements over the past two years, including inflation falling from 54.1% in 2022 to 8% in October 2025, fiscal discipline restored, the cedi stabilized, and investor confidence renewed.
“Confidence is returning, the Black Star is rising once more. Ghana’s economy has regained its rhythm, and the tide has turned,” Dr. Forson concluded.
