Government has proposed a significant increase in the Growth & Sustainability Levy, aiming to raise the rate from 1% to 3% on the gross production of mining companies operating within the country.
This move is intended to ensure that Ghana receives a fair share of the benefits derived from the rising global prices of gold, which have recently experienced a notable surge.
The proposed increase is part of broader fiscal measures aimed at enhancing the country’s revenue streams, and ensuring that the mining sector contributes more significantly to national development.
Presenting the 2025 Budget before parliament, Finance Minister Dr. Cassiel Ato Forson said government has also suggested extending the current sunset clause for the levy until 2028, providing a more predictable and stable framework for the levy’s implementation.
“Consequently, we are proposing to increase the Growth & Sustainability Levy from 1% on the gross production of mining companies to 3% to enable the nation to have its fair share of the windfall from increase in gold prices. We also propose to extend the sunset clause to 2028”, he said.
The decision comes amid a backdrop of growing global gold prices, which have been buoyed by various economic factors, including inflationary pressures and geopolitical uncertainties. Government believes the country stands to benefit significantly from these price increases.
Mining companies in Ghana, which have historically been subject to various tax and royalty schemes, could face increased operational costs due to the rise in the levy. However, the government argues that this is a necessary step to ensure that the country’s resources are being used to their fullest potential for the benefit of its citizens.
Analysis
The extension of the sunset clause could also be a strategic move to provide the mining industry with clarity and stability over the medium term, avoiding the uncertainty that often accompanies sudden tax changes.
The extended sunset clause, set to last until 2028, will provide mining companies with sufficient time to adapt to the new levy framework, and enable government to focus on sustainable growth and ensure that the country’s natural resources are utilized for long-term development.
The increase in the Growth & Sustainability Levy will help leverage the country’s natural resource channeling it towards productive infrastructure and human capital.
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