A new research report launched by BudgIT Ghana, in collaboration with the International Budget Partnership (IBP) and the Society of Women in Taxation (SWIT), has revealed significant misconceptions about tax obligations among informal sector workers in the Greater Accra Region.
The study, part of the Informal Sector Tax Compliance Research Project, was unveiled in Accra under the theme: “Ghana’s Untapped Economy: Analysis of Tax Compliance Behaviour of Informal Sector Workers in the Greater Accra Region.”
Country Manager of BudgIT Ghana, Jennifer Moffatt, highlighted the urgency of addressing the knowledge gap.
“One of the key findings, from the focus groups to the surveys, was that most people in the informal sector are not able to differentiate between taxes and levies. They believe that as long as they are paying market tolls or local levies, they have fulfilled their tax obligations,” she explained.
“People feel more comfortable paying money to local governments than to the GRA. Why not integrate collections?” she added.
According to her, this misunderstanding points to a critical need for collaboration between the Ghana Revenue Authority (GRA) and Metropolitan, Municipal and District Assemblies (MMDAs), adding that the government could adopt a system similar to VAT, where the collected money is broken down and allocated to the relevant institutions like GRA and the assemblies.
She noted further that the report recommends the development of a digital platform—not just for online payments but also USSD systems for sending SMS reminders to taxpayers. “We’ve been discussing the use of short codes like *222# or *880# to encourage compliance, such as simple text message reminders to taxpayers about their tax obligations.”
Speaking at the event, Dr. Alex Kombat of the GRA acknowledged the challenges in taxing the informal sector and shared details of the soon-to-be-launched Modified Taxation System. “We’ve categorized taxpayers based on turnover. For example, if your turnover is below GH¢20,000, you pay a flat rate—GH¢25, GH¢35 or GH¢45 per quarter,” he explained.
On her part, Esi Sam, Chair of SWIT Ghana, emphasized the importance of visibility and transparency in tax utilization to improve compliance.
BudgIT Ghana disclosed further that it is in talks with the management of the GRA to share the full findings of the research with them, in the hope that the recommendations will inform policy proposals to the Ministry of Finance and be incorporated into the 2026 national budget.
