Ghana Removes VAT on Mineral Exploration to Strengthen Investment Competitiveness
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Ghana has abolished its 15% VAT on mineral exploration and reconnaissance activities, a policy reversal aimed at restoring competitiveness, attracting new investment, and reinforcing long-term sustainability in its mining sector.
The now-removed VAT was introduced 25 years ago during broad fiscal reforms, ultimately raising upfront costs for exploration firms and discouraging greenfield projects. With regional peers such as Côte d’Ivoire, Burkina Faso, and Kenya already exempting exploration from VAT, Ghana’s previous stance had eroded its regional competitiveness.
Finance Minister Cassiel Ato Forson announced the tax elimination during the 2026 budget presentation, positioning the shift as a key tool to rebuild investor confidence and stimulate exploration pipelines. The change is part of a wider policy review designed to promote responsible mining and curb unregulated prospecting that has contributed to environmental degradation.
Mining remains central to Ghana’s economy, led by gold and supported by bauxite and manganese. The sector contributes more than one-third of national export revenues. Recent regulatory reforms have formalized artisanal mining and tightened export rules, enabling record small-scale gold exports of 81.7 metric tons valued at roughly $8.1 billion between January and October 2025, surpassing large-scale output for the first time.
Major operators include Newmont, AngloGold Ashanti, Gold Fields, Perseus Mining, and Chinese firms such as Zijin and Cardinal Namdini. Parallel to the VAT removal, the government is auditing mining companies to enhance revenue collection and ensure compliance amid ongoing reform.
The Ghana Chamber of Mines welcomed the VAT elimination, noting its removal will ease exploration costs, strengthen investment attractiveness, and help rebuild the project pipeline. Stakeholders expect the change to draw increased foreign direct investment and support innovation in exploration and mining technologies.
The VAT repeal aligns Ghana with regional best practices and reflects an effort to balance fiscal interests with strong environmental and social governance. Reduced operational barriers are likely to enhance long-term competitiveness and support sustainable sector expansion.
