GRA to roll out new tax rules for informal workers starting July 1
By Praisebell Rosemond Larbi
The Ghana Revenue Authority (GRA) has announced the introduction of a new modified tax system targeting the informal sector, which will officially take effect from July 1, 2025.
The initiative aims to enhance tax compliance and broaden the national tax base, particularly among workers and entrepreneurs operating outside the formal economy. Informal sector workers whose annual turnover is below GHS 20,000 will now be required to pay a fixed quarterly tax ranging from GHS 25 to GHS 45, depending on their income bracket.
Speaking during the launch of the final report on Informal Sector Tax Compliance Research, Assistant Commissioner for Research and Policy at the GRA, Dr. Alex Kombat, emphasized that the new system was designed to ensure fair and simple taxation for a group that has historically remained under-taxed.
“We have developed a system called modified taxation. Those with turnover below GHS 20,000 will pay a fixed amount, GHS 25, GHS 35, or GHS 45. For those with turnover between GHS 20,000 and GHS 500,000, we’ll apply a 3 percent tax on their turnover. This marks a shift from traditional tax collection methods,” Dr. Kombat stated.
He indicated that the GRA will rely on public sensitization campaigns and partnerships with key stakeholders to ensure the program’s successful rollout.
Research-Informed Policy Shift
The announcement coincided with the unveiling of the research report titled: “Ghana’s Untapped Economy: Analysis of Tax Compliance Behavior of Informal Sector Workers in the Greater Accra Region.” The study was conducted by BudgIT Ghana in collaboration with the Society for Women in Taxation Ghana and the International Budget Partnership (IBP).
Presenting the findings, Jennifer Moffatt, Country Manager of BudgIT Ghana, noted that mistrust of central government institutions and a preference for dealing with local assemblies were key factors contributing to low tax compliance in the informal sector.
“One of our key recommendations is for the GRA and Metropolitan, Municipal, and District Assemblies (MMDAs) to collaborate on tax collection. Many informal sector workers feel more comfortable paying levies to local authorities than to the GRA,” she observed.
Sectoral Support
The proposed reform has also received endorsement from key professional and civil society organizations.
Chairperson of the Society of Women in Taxation, Esi Sam, commended the initiative, calling it a “good move” that could demystify taxation for informal workers.
“When you understand something, it becomes easy to do because it’s straightforward. So, if the modified taxation system is being introduced, it’s a good move, it will simplify the process and make it easier for people to understand,” she remarked.
The informal sector, which accounts for nearly 70 percent of Ghana’s workforce, has long been viewed as a critical yet under-tapped source of government revenue. Analysts say the success of this new system could significantly enhance domestic revenue mobilization while fostering a more equitable tax regime.
The GRA has urged the media and civil society to help in public education to encourage voluntary compliance and reduce resistance ahead of the July 1 rollout.
