Additional tax and other incentives may also be negotiated for strategic projects on a case-by-case basis. In line with the new Government’s broad plans to make the economy a business-friendly one and re-energise the private sector, the Government is currently reviewing some of the taxes to provide relief for businesses and promote investments in certain sectors of the economy. Ghana has also recently enacted a revenue administration act, the Revenue Administration Act, 2016 (Act 915) which consolidates tax administration and collection processes in an attempt to streamline the revenue administration and collection process, reduce obstacles to compliance and clarify administrative gaps in the existing tax laws. Tax Treaties Ghana has entered into double tax treaties with Belgium, Denmark, Germany, France, Italy, the Netherlands, the United Kingdom, South Africa and Switzerland. On March 10, 2017, Ghana signed a tax treaty with Mauritius, yet to be ratified by the Parliament. The treaty, which aims to regulate tax treatment of income or capital gains on a taxpayer, will also facilitate trade between the two countries through elimination of non-tariff barriers and collaborate on investment promotion and protection to better channel investment. Other Bi-lateral Treaties Ghana has entered into and ratified various bilateral investment treaties with China, Denmark, Germany, Malaysia, the Netherlands, Switzerland and the United Kingdom. Currently, negotiations have been concluded between twenty-six (26) countries, nineteen (19) of which are awaiting parliamentary ratification. Ghana enjoys several investment related agreements with the United States of America including the African Growth and Opportunity Act (AGOA), Trade and Investment Framework Agreement (TIFA), OPIC Investment Incentive Agreement and the Open Skies Agreement.
There exists a VAT Flat Rate Scheme ( VFRS ) designed for traders operating in the retail sector. This allows such small- scale traders to charge VAT at a marginal rate of 3%. Additional taxes include customs and excise duties, the communication service tax on telecommunications and airport taxes on use of the international and domestic airports. Stamp Duty This is a tax on documents brought into being for the purposes of recording transaction. It is therefore a tax on documents or specific instruments. Tax incentives The following are some of the tax concessions under Ghana’s Income Tax Act, 2015 (896): • An enterprise granted a licence under the Free Zones Act, 1995 (Act 504) enjoys 100% tax holiday on profits for the first 10 years from the date of commencement of operation. • Companies engaged in the waste processing business enjoy a 1% tax concession for a period of seven years. • The income of a qualifying venture capital financing company is subject to tax of only 1% for a period of 10 years. • Companies engaged in various forms of agricultural businesses such as farming of tree crops, cash crops, livestock and agro processing business conducted wholly in Ghana enjoy a 1% tax concession for periods varying from 5 to 10 years. • In calculating the income of a company from business in a year of assessment, companies may be entitled to an additional deduction of 10% to 50% (depending on the number of new graduates employed during the year of assessment) of salaries paid to new graduates employed by the company.
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