President John Dramani Mahama yesterday assented to the COVID-19 Health Recovery Levy Repeal Act 2025.
This effectively scraps the one per cent charge imposed on goods, services and imports since the height of the COVID-19 pandemic.
The repeal follows Parliament’s passage of the bill last month as part of the government’s effort to eliminate what it has described as “nuisance taxes” and ease the cost of living for households and businesses.
The COVID-19 levy was introduced in 2021 under the COVID-19 Health Recovery Levy Act (Act 1068).
Signed into law on March 31, 2021, it placed a one per cent levy on the value of taxable supplies of goods and services in Ghana as well as on imports, except for items exempt under VAT rules.
The levy was not allowable as an input tax deduction, effectively and adversely increasing the tax burden on businesses and households.
It was charged in addition to existing consumption taxes, including Value Added Tax (VAT), the National Health Insurance Levy (NHIL) and the Ghana Education Trust Fund (GETFund) levy.
The repeal, which had the overwhelming support of both sides of the House, was to fulfil a promise President Mahama made to Ghanaians.
The assent by the President yesterday will pave the way for its implementation beginning January 2026.
After the Presidential assent, the law will now be gazetted for it to become a full-blown, legally binding framework.
Outliving purpose
In the 2026 Budget, the government announced its commitment to streamline the indirect tax regime and to reduce the overall cost of doing business as part of broader efforts to stimulate growth, support private sector-led recovery and improve compliance in the VAT system.
The Minister of Finance, Dr Cassiel Ato Forson, who laid the law in Parliament for its repeal, explained that the COVID-19 Health Recovery Levy Act, 2021, had outlived its original purpose.
The repeal was, therefore, a part of the comprehensive VAT reform agenda aimed at creating a more transparent, equitable and growth-friendly consumption tax system, he said.
Fiscal impact
Moving the motion for the House to adopt the Finance Committee’s report and approve the bill, the Chairman of the committee, Isaac Adongo, said the repeal of the COVID-19 Health Recovery Levy Act, 2021 (Act 1068) would put more than GH¢3 billion in the pockets of Ghanaians and the coffers of businesses.
He, however, said the Finance Minister had assured the committee that, with the current tax reforms ongoing, it was expected that the measures would result in an increase in business activities in the country and thereby lead to an increase in tax revenue.
