GRA Increases VAT Registration Threshold to Ease Pressure on Small Businesses

The Ghana Revenue Authority (GRA) has increased the Value Added Tax (VAT) registration threshold in a move aimed at reducing the tax burden on small and micro-scale businesses across the country.

Under the revised policy, businesses will now be required to register for VAT only if their annual turnover reaches GH¢750,000, up from the previous threshold of GH¢200,000. This change means that many small enterprises will no longer be obligated to charge VAT or comply with associated filing requirements.

According to the GRA, the adjustment is intended to simplify tax compliance, lower operating costs for small businesses, and encourage entrepreneurship, particularly among startups and informal sector operators. Officials believe the new threshold will help businesses retain more capital to reinvest in growth and job creation.

Small business owners have welcomed the decision, describing it as a major relief that could improve cash flow and reduce the administrative burden associated with VAT registration and reporting. Many traders and entrepreneurs had previously raised concerns that the former threshold placed undue pressure on businesses still in their early stages.

The GRA explained that the policy aligns with broader government efforts to support inclusive economic growth, strengthen the private sector, and create a more business-friendly tax environment. Regular reviews of tax policies, the authority noted, are necessary to ensure they remain responsive to current economic conditions.

Further guidance on the implementation of the new VAT threshold and its impact on affected businesses is expected to be issued by the GRA in due course.

Source: Thepressradio.com