Ghana’s VAT Tax Gap Widens: 61 % of Potential Revenue Uncollected
A recent VAT gap study reveals Ghana is currently collecting only 39 % of its theoretical VAT potential—meaning a massive 61 % remains uncollected . The average VAT gap from 2013–2022 was 59.2 %, fluctuating between 55.3% and 65.9%, with the peak in 2020. The service sector generates the bulk of the gap (avg. 53.5 %), with industry contributing around 41.9 %, and agriculture only ~4.7 %. Why the VAT Gap Matters Revenue Loss: Huge sums are not reaching public coffers—hindering funding for healthcare, education, and infrastructure. Compliance Challenges: Weak invoicing, under‑declaration in services, and limited VAT audits fuel the gap. Policy Shortfalls: Exemptions and outdated systems contribute to leakages that undercut government fiscal targets. Expert Solutions Tax experts propose several measures to close the gap: Strengthen Compliance Audits — Focus especially on the service industry. Introduce E‑Invoicing — Mandate digital billing systems across VAT-paying businesses […]
