Ghana Cheer as President Mahama Abolishes COVID-19 Health Recovery Levy

Ghana has officially taken a major step toward easing the tax burden on consumers and businesses as President John Dramani Mahama has signed the COVID-19 Health Recovery Levy Repeal Act, 2025 into law. The presidential assent, given on December 10, 2025, marks the end of the 1% levy that had been charged on imported goods, taxable supplies, and a wide range of services since the pandemic era.

What the Repeal Means

The COVID-19 Health Recovery Levy was introduced in 2021 as a temporary revenue measure to support pandemic-related health costs and economic recovery. Over time, however, the levy became one of the most widely criticized consumption taxes due to its impact on the prices of everyday goods and services.

With the repeal now approved, the levy will be completely removed from the tax structure beginning January 2026. This means consumers should expect a slight reduction in the prices of VAT-related items, while businesses—particularly importers and service providers—stand to benefit from eased cost pressures.

Why Government Repealed the Levy

According to the administration, the repeal is part of a broader tax-reform strategy designed to create a more efficient and growth-friendly consumption tax system. Removing the levy is expected to:

Reduce the cost of doing business

Support private-sector expansion

Boost consumer confidence and spending

Streamline Ghana’s indirect tax regime

Although the repeal is estimated to create a revenue gap of about GH¢3 billion, government officials believe economic growth and increased commercial activity can help offset the shortfall.

What Citizens and Businesses Should Expect

From January 2026, businesses will no longer be required to add the 1% levy to the price of taxable goods and services. Importers will also experience cost relief at the ports, potentially leading to reduced market prices for various consumer goods.

However, analysts caution that price reductions may vary depending on sectors, supply chains, and global market conditions. Consumers are encouraged to monitor pricing trends as businesses adjust to the new fiscal environment.

A Major Shift in Post-Pandemic Policy

President Mahama’s approval of the repeal signals a decisive move away from COVID-era fiscal measures and toward policies targeted at long-term economic resilience. The administration insists that this is only the beginning of a larger effort to simplify Ghana’s tax system and stimulate sustainable growth.

Picture Credit - The Presidency Ghana 

As the repeal officially takes effect in 2026, households and businesses alike will be watching closely to see how the removal of the levy influences market prices and business operations across the country.