Ghana’s Finance Minister, Dr. Cassiel Ato Forson, has disclosed that the country is losing an estimated 60% of its potential Value Added Tax (VAT) revenue due to non-compliance and systemic inefficiencies.
The admission highlights the severity of the fiscal challenges facing the West African nation as it struggles to close a widening budget gap.
The revelation comes as Ghana’s government increasingly turns to borrowing to finance critical national programs, including education and infrastructure.
Persistent revenue shortfalls have forced the state to rely on debt to maintain essential services, raising concerns about long-term fiscal sustainability and sovereign risk.
The VAT framework has been under renewed scrutiny from economists and policymakers who argue that the system has not been optimized to generate sufficient state revenue.
This development adds weight to ongoing debates about tax reform in Ghana.