Accra: Finance Minister Dr. Cassiel Ato Forson has defended the government's decision to apply Value Added Tax (VAT) on imported services consumed in Ghana, emphasizing that the policy is essential for broadening the country's tax base while ensuring fairness within the tax system. During an interview on Citi FM on Friday, July 24, 2026, Dr. Forson clarified that VAT is applied based on the location of consumption rather than the origin of the product or service.
According to Ghana Web, Dr. Forson explained that excluding imported services from VAT could undermine efforts to expand the tax base, potentially necessitating higher tax rates to achieve the same revenue levels. He emphasized the importance of broadening the tax base, stating, "If I'm to exempt it, I'm not broadening the tax base; I may be forced to increase the rate."
The Finance Minister also highlighted the strategic use of import duties to protect domestic industries from unfair foreign competition. He noted that these duties make imported goods less appealing compared to locally produced alternatives, thereby supporting Ghanaian businesses. "We have ways of making sure that imported goods are less attractive. And we have a way to make our local goods attractive as compared to imported goods. And that's why we slap import duty," Dr. Forson stated.
Furthermore, Dr. Forson discussed the role of customs authorities in accurately assessing the value of imported goods. This assessment prevents undervaluation, which could allow foreign products to enter the market at low prices, potentially harming local manufacturers. "That's why the public officer assesses the true value of imported goods, so that they don't come in cheaper to compete with our local businesses and collapse them," he explained.
He stressed that effective valuation and import duty measures are crucial to the government's strategy of protecting local industries and strengthening domestic revenue mobilization. The minister's remarks come amid ongoing public debates on Ghana's tax policies and efforts to expand revenue collection without overburdening existing taxpayers.