2023 Budget

Highlights
Budget Statement and Economic Policy of
the Government of Ghana for the
2023 Fiscal Year

November 2022
Foreword
“Restoring and Sustaining Macroeconomic Stability and Resilience through Inclusive Growth & Value Addition”
Countries around the world indeed are experiencing o Aggressively mobilise domestic revenue through efficiency in government expenditures. Government
challenging times and Ghana is no exception. Global various tax reforms; proposes to integrate public procurement approval
economic activity in 2022 has experienced major o Streamline and rationalise expenditures; processes with GIFMIS to ensure that projects approved
disruption due to four broad-based factors: o Boost local productive capacity; are aligned with budget allocations, review key government
geopolitical tensions, cost-of-living crisis, tightening o Promote and diversify exports; programmes to reflect relevance, promote efficiency, and
financial conditions, and medium-term impacts of o Protect the poor and vulnerable; ensure value for money and review the efficiency of
the COVID-19 pandemic. As a country that is o Expand digital and climate-responsive physical Statutory Funds.
susceptible to external shocks, the spillover effect infrastructure; and
Whilst the above initiatives are laudable, government must
of these factors in addition to our domestic o Implement structural and public sector reforms.
put in place the necessary mechanisms to ensure
problems have exacerbated our economic
disciplined implementation.
challenges. With the current high levels of debt and recent
downgrades in credit ratings, enhancing domestic In addition to the above revenue and expenditure measures,
In the midst of the current challenges, government
Anthony Sarpong is considering a number of policy options to restore
revenue mobilisation remains a top priority for
government. Consequently, government has
government is hoping to close the IMF negotiations as soon
practicable. It has been generally acknowledged that an IMF
Senior Partner confidence in the economy, reduce the rising debt
proposed a number of revenue measures including: programme has the potential of restoring confidence in the
levels and boost economic activity.
introducing an additional PAYE tax band of 35%, economy and resetting the growth potential. This was
On 24 November 2022, the Minister for Finance, increasing VAT by 2.5%, introducing a minimum confirmed in the results of our pre-budget survey
Hon. Ken Ofori-Atta presented the Budget chargeable income tax, broadening the scope of the conducted in October 2022.
Statement and Economic Policy (the budget) under National Fiscal Stabilisation Levy (NSFL) to include
Indeed, a significant number of our respondents are of the
the theme, “Restoring and Sustaining additional industries, increasing the concessionary
view that an IMF programme could help to salvage the
Macroeconomic Stability and Resilience through tax rate of 1% to 5% amongst others. The
economy from the current crisis, although others are calling
Inclusive Growth & Value Addition” to Parliament proposed measures have been summarised in this
for structural changes to eliminate the need for future IMF
on behalf of His Excellency Nana Addo-Dankwa document under the section on tax and revenue
interventions.
Akufo-Addo. measures.
The policies and actions we take in times like this must
The budget seeks to support government’s policy It is important to note that, to achieve the above
inspire confidence in our people, give them hope and
objectives of restoring macroeconomic stability and measures, a consultative approach will ensure that
empower the change that we desire. The agility in
accelerating economic transformation. It is the concerns of individuals, households and
responding to economic shocks is a critical feature of
anchored on a seven-point agenda which is businesses are well addressed before these
resilient economies. We urge government to quickly
documented in government’s Post-COVID-19 measures are implemented.
execute these measures with discipline to restore the
Programme for Economic Growth (PC-PEG) for
economy onto a path of stability, resilience, and inclusive
Ghana’s economic transformation. The Programme Government has also outlined expenditure
growth.
focuses on the following priority areas: management priorities which should help enhance
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Contents

01 Executive Summary 06

02 Global Developments 11

03 The Economy 14

04 ESG 20

05 Tax & Non-Tax Revenue Initiatives 23

06 Expenditure Initiatives 31

07 Sector Initiatives 33

08 Outlook 48

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 2023 Budget Theme

“Restoring and Sustaining

Macroeconomic Stability and
Resilience through Inclusive
Growth & Value Addition”

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Document Classification: KPMG Public 4
Introduction
This year’s budget is anchored on a seven-point agenda aimed at restoring macro-economic stability and accelerating economic transformation as articulated
in the Post-COVID-19 Programme for Economic Growth (PC-PEG).

01 Aggressively mobilize domestic revenue

02 Streamline and rationalise expenditures

03 Boost local productive capacity

04 Promote and diversify exports

05 Protect the poor and vulnerable

Expand digital and climate-responsive physical

06 infrastructure

07 Implement structural and public sector reforms

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01
Executive
Summary
Executive Summary
2022 Provisional Outturn

40.4% GH¢ 49.1bn

Proportions of Interest Payments to
Revenue & Expenditure for Q1-Q3 2022 Tax Revenue– Fiscal Developments for Q3 2022
Q3 2022

49% 29% GH¢ 65.4bn

GH¢ 11.0bn
Inflation as at October 2022
Non-Tax Total Revenue & Grants
Revenue – Q3
2022

24.5%
of Total Revenue of Total Expenditure

GH¢ 109.4bn
Total Expenditure

2.9
Monetary Policy Rate as at Debt to GDP Ratio
October 2022
76.7%
76.0% 75.9%

4.0%
GDP Growth Rate as
months
Import cover as at
Q3 2022
7.4%
Fiscal Deficit as at
at June 2022 September 2022
2020 2021 Sep-22

Source: 2023 Budget Statement

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Executive Summary
2023 Targets

Sectoral Distribution of Nominal GDP

78% 16%
7.7%
The Services sector is expected to remain
dominant in terms of sectoral distribution of

2.8%
nominal GDP in 2023. Proportion of Tax Proportion of Non-Tax
Revenue to Total Revenue to Total
Revenue – 2023 Revenue – 2023
Fiscal Deficit target
20% Tax Revenue Breakdown (GHS bn)
GDP Growth target for 2023
for 2023
47%
59.8

33%
44.9
Fiscal Targets for 2023

GH¢ 144bn
Agriculture Industry Services 18.9%
Inflation target for 2023
Total Revenue & Grants Proportions of Interest Payments to 14.0
Revenue & Expenditure in 2023

GH¢205.4bn
Total Expenditure 37% 26%
of Total Revenue of Total Expenditure
Income and
Property
Taxes
Taxes on International
Domestic
Goods and
Services
Trade Tax 3.3 months
Import cover target for 2023

Source: 2023 Budget Statement

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Executive Summary
Direct Taxes

01 02 03
Corporate Income Tax Personal Income Tax Withholding Tax (WHT)

• Increase the existing 1% temporary concessional • Introduce an additional PAYE band of 35%. • Introduce a separate WHT regime for gains
rate for eligible entities to 5%. on realisation of assets and liabilities.
• Review the upper limit of benefit-in-kind for
• Implement a minimum chargeable income vehicle element for PAYE purposes. • Introduce WHT on gaming winnings.
system. • Review the 15% optional rate for individuals
on gains from the realisation of assets and
• Convert the National Fiscal Stabilisation Levy
liabilities.
(NFSL) to Growth and Sustainability Levy (GSL)
to cover all entities. • Provision of tax relief for early withdrawal
from Provident Fund and Personal Pension
• Provide a unified duration for Carry-Over of Tax

04
Schemes for individuals who lose their jobs
Loss for all industries. permanently or their capital due to the
• Limit the deduction of foreign exchange losses current economic crisis.
Vehicle Income Tax & Income Tax Stamp
to realised loss and ensure all realised foreign
exchange losses of capital nature are capitalised. • Review of the Vehicle Income Tax (VIT)
• Introduce a tax on Gross Gaming Revenue to Sticker and Income Tax Stamp rates.
replace Corporate Income Tax and VAT on these
activities.

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Executive Summary
Indirect Taxes Non Tax and Other Revenue Measures

01 02 01
Customs & Excise Value Added Tax (VAT) Non-Tax Revenue Measures

• Implement the Customs Tariff with the • Increase the VAT rate by 2.5% from • Full roll-out of the Unified Common Platform for property rate
2022 version of the Harmonised 12.5% to 15%. administration.
Commodity Description and Coding • Review the registration threshold for • Re-introduction of road tolls on selected public roads and
System (HS Code). VAT. highways.
• Introduce a self-clearance system for • Undertake major reforms with respect • Revenue Assurance and Compliance Enforcement (RACE)
imports by individuals without the to VAT exemption. programme to focus on revenue from imported cargo.
services of a Customs House Agent. • Full rollout of Electronic VAT Invoicing
• Revise the taxation of cigarettes and (E-VAT Invoicing) to Large Tax Payers
(including listed companies).

02
tobacco products to align with ECOWAS
protocols.
• Introduce excise tax on electronic
Other Revenue and Administrative Measures

03
smoking devices and liquids.
• Provide guidelines and procedures for full implementation of the
• Increase excise tax rate for spirits above
Exemptions Act, 2022 (Act 1083).
that for beer.
Electronic Transfer Levy (E-Levy)
• Institute a freeze on tax waivers for foreign companies.
• Full withdrawal of the existing
• Review the E-Levy rate from 1.5% to • Review tax exemptions for companies in the free zone, mining, oil and
benchmark discount policy on imported
1%. gas sectors.
goods.
• Removal of daily exemption threshold. • Pursue Additional Oil Entitlement in relation to the Jubilee Field.
• Full implementation of Excise Tax Stamp
on Textiles by end of first quarter 2023. • Enhance administrative mechanisms to improve rent tax compliance.

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02
Global
Developments
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Global Economic Developments & Outlook

Persistent inflationary pressures has prompted rapid monetary policy tightening measures by central banks across the world. Global GDP growth rate is
projected to slow down from 6.0% in 2021 to 3.2% in 2022 and further contract to 2.7% in 2023. Global inflation is forecasted to rise from 4.7% in 2021 to
8.8% in 2022 but to decline to 6.5% in 2023 and to 4.1% by 2024.

NORTH AMERICA SUB-SAHARAN AFRICA

• The Federal Reserve has increased the fed rate 6 times this year to
tackle inflationary pressures. • Inflation in SSA is forecasted to be 14.4% and 11.9% in 2022 and
2023 respectively.
• The dollar has appreciated against major currencies due to the
tightening of the monetary policy in the US. • Growth is expected to slow sharply due to tighter global financial
conditions, and a dramatic pickup in global inflation.
• Growth in the United States is projected to be 1.6% and 1.0% in 2022
and 2023 respectively. • Growth in SSA has been revised downwards to 3.6% and 3.7% in
2022 and 2023 respectively. The region is experiencing a negative
• The contraction of the economy is due to declining disposable income shift in commodity terms of trade, lower trading partner growth and
and higher interest rates. tighter monetary conditions.

EUROPE MIDDLE EAST, EMERGING & CENTRAL ASIA

• The European Central Bank has ended net asset purchases and • Growth in the Middle East and Central Asia is projected to be 5.0% in
continues to raise interest rates. 2022 and moderate to 3.6% in 2023. The upward revision is due to the
favourable outlook for the region’s oil exporters and an unexpectedly
• Growth in the Euro area is projected to be 3.1% in 2022 and 0.5% in
mild impact of the war in Ukraine.
2023. The upward revision of growth (0.5%) in the third quarter of
2022 resulted from recovery of tourism-related services and • Growth in Emerging Asia has been revised downwards to 4.4% and
industrial production in economies like Italy and Spain. 4.9% in 2022 and 2023 respectively. Frequent lockdowns in China and
the rapid weakening of its property sector has led to growth
• The downward revision of growth in 2023 reflects spill over effects
contraction.
from the Russia-Ukraine war and impact of the Russian gas supply
cuts on economies. • This would impact global trade and activity due to supply chain
disruptions.

Sources: World Economic Outlook, IMF (October 2022), Forbes

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Global Economic Developments & Outlook

COMMODITY PRICES IMPLICATIONS FOR GHANA’S ECONOMY
Prices of major commodities have been projected to fall in 2023 as growth
contracts.
▪ Trade spill-overs
from other recovering
Crude Oil
economies and major export Revenue
$ 100
▪ 1
Crude oil prices is projected to decline by 8% markets. increase resulting from
to average $92 per barrel in 2023 and reduce exchange rate depreciation on
per barrel further by 13% to $80 per barrel in 2024. forex-related inflows.

Gold
$ 1,775
▪ Average inflation
Gold is projected to average $1,700 per ounce is expected to decline due to
monetary policy tightening. Policy rate adjustments
per ounce in 2023 and $1,650 in 2024. ▪ 1
by the Central Bank is expected
to tackle the persistent inflation.

Cocoa
6.8% Cocoa is forecasted to average $2,350 per
tonne in 2022. The outlook is for cocoa to
▪ Pharmaceutical sector
boost
is expected from the local
Global cocoa average $2,300 per tonne in 2023 and vaccine production. Agriculture sector
production ▪ 1
$2,340 per tonne in 2024. growth would be affected by
the contraction of the cocoa
subsector.

Official Development Assistance An agreement was finally FDI inflows to Africa hit a Ghana was the second
$161bn (ODA) from official donors rose to reached to establish and $4.5bn
COP 27 record $ 81 billion in 2021. highest recipient of
Net ODA operationalise a new loss FDI Inflows Remittances
an all-time high of USD 178.9 remittances in Sub-
billion in 2021. and damage fund. Saharan Africa in 2021.

Sources: World Bank, UNCTAD, OECD Budget

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03
The Economy
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Macroeconomic snapshot
Macroeconomic 2021 2022 Revised 2022 End Sept. 2023
Performance Outturn Targets Outturn Targets

Overall GDP Growth Rate 5.4% 3.7% 4.0% ** 2.8%

Non Oil GDP Growth Rate 6.9% 4.3% 5.1% ** 3.0%

End Period Inflation Rate 12.6% 28.5% 40.4%* 18.9%

Fiscal Deficit (% of GDP) 9.2% 6.6% 7.4% 7.7%

Primary Balance (% of GDP) (1.9)% 0.4% 2.0% 0.7%

Import Cover
(Number of months cover)
4.3 3.5 2.9 3.3

* As at October 2022
** As at Q2-2022

Source: Mid Year Budget Statement 2022, 2023 Budget Statement

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Fiscal Developments for 2022

Total Revenues & Grants – GH¢ 65.4 billion Total Expenditure – GH¢ 109.4 billion
(incl. arrears clearance of GH¢ 9.9 billion)

Tax Revenue (Net of refunds) – GH¢ 49.1 billion Compensation of Employees – GH¢ 27.1 billion
▪ Taxes on Income and Property: GH¢ 24.8 billion ▪ Wages & Salaries constitutes ~ 91%
▪ Taxes on Domestic Goods and Services: GH¢ 20.9 billion ▪ Social Contributions ~ 9%
▪ International Trade Taxes: GH¢ 6.2 billion
▪ Tax refunds: (GH¢ 2.8 billion)
Use of Goods and Services – GH¢ 4.2 billion
▪ Representing 0.7%of GDP
Social Contributions – GH¢ 280 million
▪ 45% below 2022 target of GH¢ 511 million
Interest Payments – GH¢ 32.1 billion
▪ Domestic: GH¢ 25.1 billion ~ 78%
▪ External: GH¢ 7 billion ~ 22%
Non tax revenue – GH¢ 11 billion
▪ Representing 1.2% of GDP
Revenue Expenditure
Subsidies, Social Benefits etc. – GH¢ 25.2 billion
▪ GH¢ 167 million for Subsidies
Other Revenue – GH¢ 4.2 billion ▪ GH¢ 374 million for Social Benefits
▪ This is made up of SSNIT contribution to NHIL and proceeds ▪ GH¢ 7.1 billion for Other Expenditure
from the Energy Sector Levies, representing 0.7% of GDP ▪ GH¢ 17.6 billion for Grants to Other Government Units

Capital Expenditure – GH¢ 10.9 billion

Grants – GH¢ 797 million ▪ Domestic financed ~ 15%
▪ This represents Project Grants ▪ External financed ~ 85%

✓ Total government revenue and grants of GH¢ 65.4 billion represents 11% of GDP for January to September 2022. This is driven mainly by taxes on income and property (~37.9% of total
revenue and grants) as well as taxes on domestic goods and services (~32% of total revenue).
✓ Total expenditure (incl. arrears) of GH¢ 109.4 billion for the same period represents 18.5% of GDP.
✓ There was an overall budget deficit of GH¢ 44 billion (7.4% of GDP) against a programmed deficit of GH¢ 36.7 billion (6.2% of GDP) for January to September 2022. This is as a result of
shortfalls in revenue and faster execution of expenditures.
Sources: 2023 Budget Statement

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Public Debt
Public Debt Trajectory Growth Trends in Public Debt
• The provisional gross value of Ghana’s public debt stock as at end- 75%

September 2022 stood at approximately GHȼ467.4 billion, representing 59.5%

External debt stock grew by 59.5% (an
75.9% of GDP. This was up from GHȼ352.1 billion at the end of increase of GH¢101.4 billion) of which 93% is
December 2021. The increase in the debt stock is mainly attributable to 50% attributable to exchange rate fluctuations
exogenous factors which resulted in rising interest cost and 32.7%
depreciation of the local currency.
25%
• As at the end of September 2022, depreciation of the Ghana Cedi
added about GH¢93.9 billion to the external debt stock compared to 7.6%
transaction effect of approximately GH¢7.5 billion. This increased the
0%
proportion of external debt stock to 58.1% of total public debt, up from
2018 2019 2020 2021 Sept. 2022
48.4% reported in 2021. The gross value of domestic debt also stood
at approximately GH¢195.7 billion, representing 41.9% of the total debt Public Debt (% y-o-y) External Debt (% y-o-y) Domestic Debt (% y-oy)
stock. Comparatively, the domestic portion of the debt mix was lower
than 2021 which was reported to be 51.6%.
• Despite the rising trend in the total debt stock, the commencement of Debt to GDP Trends
the IMF programme may increase investor confidence, cushion the
performance of cedi and ensure fiscal discipline. This, in turn, can
control the upward movement of the debt stock.

77%
Credit Ratings in 2022 74% 76%
61%
56%
44%
36% 38% 37% 40%
28% 28% 32% 30% 32%

Caa2 CC CCC+/C
2018 2019 2020 2021 Sept. 2022

Moody’s Rating Fitch Rating S&P Rating Total Debt to GDP External Debt to GDP Domestic Debt to GDP
Oct. 2022 Sep. 2022 Aug. 2022 NB: Percentages may not add up due to rounding

Sources: 2023 Budget Statement

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Monetary Sector
Historical Foreign Exchange Rate Trend
• In October 2022, inflation increased to 40.4%, up from 37.2% in 15.91
September and 33.9% in August 2022. The rise in prices was 13.64
fuelled by rising global crude oil prices and the cedi's depreciation.
As a result, transportation costs rose, putting a strain on the 13.11
consumer basket of food and non-food items.
8.09
6.75
• In order to reduce pressures on aggregate demand, the Bank of
Ghana's Monetary Policy Committee (MPC) increased the 6.02
Monetary Policy Rate (MPR) from 14.5% as at the beginning of the Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

year to 24.5% in October 2022. The 1,000 basis point increase NB: Data collected on 24 November 2022 GHS/USD GHS/GBP GHS/EUR
was intended to tighten liquidity conditions in the banking industry,
resulting in an increase in the weighted average interbank rate to Depreciation Rates (October 2022)
23.98% in October 2022, up from 12.66% in October 2021.

• The changes in the interbank market caused the average bank

54% 46% 47%

lending rate to rise from 20.34% in October 2021 to 31.40% in
October 2022.

• On the foreign exchange market, the cedi fell by 53.8% against GHS/USD GHS/GBP GHS/EUR
the US Dollar, 45.7% against the Pound Sterling, and 46.9%
against the Euro. The weakening of the local currency’s value was
due to tremendous pressures from both internal and external
forces. These factors include tightening global financing
conditions, the sovereign downgrades and restricted access to Monetary Policy Rate 14.50% 19.00% 24.50%
markets as well as heightened demand pressures for foreign Dec-21
Average Bank Lending
currency amid supply shortages. Rate 20.04% 22.53% 31.40% May-22
Oct-22
Inflation 12.60% 27.60% 40.40%
Source: Ministry of Finance 2023 Budget Statement, Bank of Ghana

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Real sector performance

Services Industry Agriculture

46.2%
share of GDP as at
32.1%
share of GDP as at
21.7%
share of GDP as at
2022 H1* 2022 H1 2022 H1
5.4% 1.8% 4.9%

The industry sector showed significant Although the agriculture sector recorded the
The services sector remained the sector with the largest share second highest growth rate of 4.9% in the
of GDP. Although the sector recorded a significant decline of recovery in 2022 H1 compared to its
negative growth rate of 3.1% in 2021 first half of 2022, its growth rate dropped
about 2.6% compared to the first half of 2021, it recorded the significantly in the second quarter of 2022
highest growth rate of 5.4% in the first half of 2022. The H1. The manufacturing subsector
recorded the highest growth rate of to 4.6% from 11.9% in 2021. Forestry and
information and communication sub-sector leads the services logging was the only subsector to record an
sub-sector, recording the highest growth rate of 20.3%. Other 4.8%. The mining and quarrying
subsector recovered after recording a average contraction of about 0.4% over the
key subsectors such as hotels and restaurants, financial services period. The fishing subsector exhibited
and insurance activities and education also experienced contraction of 17.9% in 2021 H1
compared to a growth rate of 0.6% in significant improvement from its negative
significant growth in 2022 H1 compared to 2021 H1. The real growth rate of 0.1% in 2021 H1 to recording
estate subsector, however, contracted by -5% in H1 2022 2022 H1. The recovery was fuelled by
increased oil and mineral production, the highest growth rate of 15.9% in 2022
compared to its 13.3% growth rate in H1 2021 primarily due to H1.
spikes in the cost of building materials. Administrative and predominantly gold.
support service activities also contracted by -11.5% in the same
period.
Growth rate
* H1 – First Half
Source: Ministry of Finance Statement 2023

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04
ESG
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

ESG and Sustainability

The pace of integrating environmental, social and governance (ESG) factors into policy decisions has become an imperative for businesses and governments across the world.
A nation’s stewardship towards its environmental, social and governance (ESG) factors is having major implications on its perceived creditworthiness for their debts and
issuances. The Government of Ghana in the 2023 budget has highlighted a number of initiatives that have been completed and others that will start within the year.
Government is gradually setting a blue print for ESG through various regulatory authorities including the recent launch of an ESG manual by the GSE. Below are some key
developments in the ESG space and how they are impacting governments and businesses globally.

A Legacy of Sovereign Credit

Leadership Risk Rating

Across the world, governments have a long history of leading efforts to

improve what we now call ESG issues; setting green standards, defining Today, the impact of ESG is far and wide and has the potential of impacting the
social programmes, establishing reporting metrics and other achievements. sovereign credit risk assessments of countries. Major factors specific to a nation’s
wealth and management of ESG risks and opportunities are being given increasing
Having developed the first SDGs country financing roadmap and other weights by international credit rating agencies.
initiatives, Ghana has the opportunity to drive more positive changes.

Notable Global
ESG Trends In September 2022

❑ The UK’s Financial Conduct Authority is set to develop a standardised

Moodys CIS-4 5 [+] Fitch
code of conduct for ESG data and ratings providers. Global rating agencies cited weak ESG Credit Impact Score as key drivers for
downgrading Ghana's long-term issuer rating to ‘Caa2’ and 'CC’ respectively.
❑ COP27: Breakthrough on landmark deal to fund poorer countries’
response to climate change-related losses and damage.
➢ Agriculture sector exposure to climate risks and
droughts
❑ The International Sustainability Standards Board (ISSB) aims to complete its Key Issues ➢ Water management risks
global baseline standards for ESG reporting by the end of 2022. Cited: ➢ Weak institutions and access to basic services
➢ Constraints on social programmes from fiscal
challenges.
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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

ESG and Sustainability

The government’s initiatives below seek to improve Ghana’s ESG credentials globally. Successful implementation of these will have positive consequential
impacts on our environment and society as a whole. Government need to intensify public awareness and sensitization to drive the entire populace along.

01 Environmental 02 Social
Addressing Climate Change
❑ Ghana lost US$15.20 billion (2000 – 2019) due
to climate change.
Social Welfare Gains
❑ National Health Insurance claims management
enhanced by the electronic system.
03 Governance Responsible Business
❑ The National Carbon Credit Framework has ❑ The GSE has established a sustainability-
been developed with a carbon registry system ❑ LEAP beneficiaries increased to 1,827,035 themed bonds market with the Ghana Fixed
to support managing carbon credits. individuals with 76% enrolled onto the (NHIS). Income Market (GFIM) rules.
❑ Over 82,371 permanent and casual rural jobs ❑ GSE has launched its ESG reporting guidelines
❑ Minerals Commission launched 65 created under NAELP. for listed entities.
community mining schemes in 8 districts.
❑ 15,025 farmers benefited from land restoration
❑ The NAELP programme achieved the technologies and practices.
following:
➢ 645ha of degraded lands reforested In 2023:
➢ 20 million economic seedlings nursed for the ❑ Rural agricultural investments to be
plantation development programme supported by the Green Finance Initiative
(IGREENFIN).
In 2023:
❑ Forestry Commission to develop 25,000ha of ❑ NHIA enrolment expected to increase to
forest plantations. 20.3m by end December 2023.

❑ NAELP to stabilise 1000ha of degraded lands ❑ LEAP coverage to be expanded to all 2.5m
and nurse 1 million trees. extreme poor individuals by 2024.

❑ Pilot incentive payment system for e-waste

collection at Agbogbloshie.

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05
Tax & Non Tax
Revenue Initiatives
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Tax Revenue Measures
1. Direct Tax Measures (1/3)
❑ Introduce an additional PAYE tax band with a tax rate of 35% • Reviewing the benefit-in-kind mechanism (through the
vehicle element limit) offers a broader tax base for
• Government has proposed an additional income tax bracket with a tax rate of 35% to be
government to enhance revenue from employment income
imposed on high income earners. This is in line with the progressive principle of taxation
tax. The likely implication is employees who enjoy these
and is intended to enhance revenue mobilisation for government.
benefit will be exposed to pay more tax.
❑ Review the upper limits for vehicle element for PAYE purposes • The proposal to introduce an additional PAYE band of 35%
may yield increased tax revenue for government. This follows
• The existing vehicle element limits used in ascertaining the Benefits-in-Kind (BIK) for
the progressive principle of taxation. However, considering
purposes of individual income taxes do not meet current market rates due to inflationary
the current economic situation where cost of living is very
pressures. Thus, government is proposing a review of the current upper limits to reflect
high, it is, important to consider the impact of this on the
current trends.
disposable income of employees and the cascading effect on
their spending capacity as well as support for their
❑ Introduce a withholding tax (WHT) regime for gains on realisation of assets and dependants.
liabilities
• The introduction of a separate withholding tax rate for gains
• Government intends to introduce a separate withholding tax regime for gains on the
on realisation of assets and liabilities has the potential of
realisation of capital assets and liabilities to counteract the revenue losses arising from the
expanding the tax net. The GRA should be able to track and
difficulty in identifying capital gains for tax purposes.
trace persons who dispose off assets using the WHT tax
return information and collect the additional tax following the
❑ Review the 15% optional rate for individuals on realisation of assets withholding.
• Government proposes to review the existing 15% optional rate for individuals on
realisation of assets.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Tax Initiatives & Revenue Measures

Budget Proposal Our Point
Our of of
Point View
View
Tax Revenue Measures
1. Direct Tax Measures (2/3)
❑ Increase the existing 1% concessional to 5% • The implementation of a minimum chargeable income system
will ensure contribution of corporate tax by all corporate
• Government plans to increase the existing concessional rate from 1% to 5% to enhance entities. Government, must however, consider exemptions
the revenue base. and reliefs for some categories of businesses, for instance
start ups could be exempted in the first three to fours years of
❑ Implement a minimum chargeable income system operation. This is to ensure that new businesses are not
• The introduction of a minimum chargeable income system for corporate entities. unduly exposed to higher tax burdens at the investment
phase.
❑ Convert the National Fiscal Stabilisation Levy (NFSL) into a Growth and
• Broadening the scope of the NSFL to include all businesses
Sustainability Levy (GSL) to cover all other sectors
has the potential of enhancing government tax revenue.
Government to expand the scope of NFSL by introducing GSL to cover other sectors of the However, businesses with stability clauses and modified tax
economy. Government groups the sectors into three (3) main categories namely: agreements may not be impacted as they are protected from
• Category A entities comprising those who are currently paying NFSL and six additional new tax in their agreements. It is evident that by this
sectors will have a GSL rate of 5%. introduction, effective corporate tax rate would increase from
• Category B entities comprising all other entities (except for the extractive sector) will about 27% to 36%. Does this make Ghana competitive in the
have a GSL rate of 2.5%. sub-region and what would be signal to the investment
community?
• Category C entities comprising extractive sector entities will have a GSL rate of 1% of
production.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Tax Revenue Measures
1. Direct Tax Measures (3/3)
❑ Unifying the existing Carry-Over of Tax Loss provisions in the Income Tax Act 896 • The proposed introduction of limitation of tax deductions to
• Government is proposing a unified period of carry over of tax loss to streamline the realised foreign exchange losses and capitalisation of foreign
administration of the carry over provision. exchange losses incurred on capital assets will only defer their
deductions into the future. The challenge with this approach is
❑ Deductibility of Foreign Exchange Losses the evidence of realisation the GRA will seek during tax audits.
This is synonymous with the position under Act 592 as repealed.
Government is proposing to:
To ensure effective implementation, the following should be
• Limit the deductibility of foreign exchange losses to only realised losses. considered:
• Restrict exchange losses on capital assets to be capitalised other than deducted in the I. A stakeholder consultation to discuss the implication of
year in which they are incurred. this change and agree what realised exchange losses
❑ Reforms to taxation of the Gaming industry are.
Government is proposing to introduce: II. A definition of realised exchange losses with exceptions
in years where the country goes through high currency
• Tax on Gross Gaming Revenue to replace Corporate Income Tax and VAT.
depreciation.
• Withholding tax on winnings.
• It is heartening to see government consider the plight of
❑ Waiver of tax on withdrawals from 3rd Tier Provident Funds and personal pension employees and self employed persons in the current economic
schemes crisis by granting relief to individuals in connections with
withdrawals from their 3rd Tier Provident Fund contributions
• Government is proposing to waive taxes on withdrawals from Tier 3 provident finds and
under certain economic circumstances.
personal pension schemes for persons who have permanently lost their jobs or capital due
to the current economic crisis. • Consultation with the GPRTU and the general public must start
early before review of the VIT are completed.
❑ Review of the Vehicle Income Tax (VIT) Sticker and Income Tax Stamp rates in 2023
• Government to review the VIT and Income Tax Stamp to enhance its competitiveness.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Tax Revenue Measures
2. Indirect Tax Measures (1/2)
• The imposition of an additional 2.5% VAT on standard-rated
❑ Increase in Value Added Tax (VAT) rate
supplies would impact cost of doing business, moving
• Government proposes to increase the existing VAT rate on standard-rated supplies from effective VAT rate from 19.25% to 21.90%. This additional
12.5% to 15%. cost is most likely to be passed on to consumers. In these
difficult times, increasing VAT will worsen the plight of
❑ Review existing VAT registration threshold under VAT Act 870 taxpayers, leaving them with little disposal income.
Government should focus more on compliance measures to
• Government is proposing a review of the existing VAT registration threshold of
ensure that those outside the tax net are brought in. For
GHS200,000 (per annum).
instance the recent VAT invigilation initiative was reported by
the Commissioner-General to have yielded about 1,700%
❑ Review E-Levy rate from 1.5% to 1% increase in revenue for a period. These initiatives should be
• Government intends to reduce the existing E-Levy rate from 1.5% to 1% to increase the encouraged.
patronage of mobile money transactions and enhance government’s revenue mobilisation • Reducing the e-levy to 1% is a great idea but removing the
drive from E-Levy. threshold may wipe off the effective impact of the reduction.
• Government also proposes to remove the daily threshold; as well as review and revise The situation of the vulnerable who were being protected
other exclusions. when the law was passed has even become worse because
of the current economic hardship. Government must
❑ Introduce major reforms in connection with VAT exemptions reconsider the removal of the threshold. Other areas
• Government is proposing a general review of the VAT exemption regime. government could consider is to place a cap on the levy based
on a defined transaction threshold and consider other
❑ Full rollout of Electronic VAT Invoicing (E-VAT Invoicing) to Large Tax Payers proposals for review of the exclusions under the levy to
(including listed companies). further enhance usage of digital payment platforms.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Tax Revenue Measures
2. Indirect Tax Measures (2/2)
❑ Implement Customs Tariff with the 2022 version of the Harmonised Commodity There have been several discussions on the full
Description and Coding System (HS Code) to enhance uniformity of trade within the restoration or withdrawal of the benchmark values.
region. While others are of the view that withdrawal would
make imports expensive and thus increase prices, it is
❑ Revise the taxation of cigarettes and tobacco products to align with ECOWAS also expected that withdrawal of the policy would boost
protocols. local production to support our local industries. To be
successful with this policy, Government should engage
❑ Introduce excise tax on products such as electronic smoking devices and liquids. all stakeholders to reach a pragmatic consensus.
❑ Increase excise tax rate for spirits above that of beer.

❑ Full withdrawal of the existing benchmark discount policy on imported goods in

2023.

❑ Full implementation of Excise Tax Stamp on Textiles by end of first quarter 2023.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Non-Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Non-Tax Revenue Measures

❑ Full roll-out of the Unified Common Platform for property rate administration
The proposed implementation of the common platform
• Government plans to begin the implementation of the Unified Common Platform for property rate administration in January 2023 will
for property rate in January 2023. help streamline the collection of property rates. This
will assist government to meet its’ medium term non-
❑ Re-introduce road tolls tax revenue target. However, it is worth noting that, for
the unified common platform to work effectively, there
• Government has proposed the reintroduction of road tolls on selected highways in should be an improvement in the current process of
the country. Government intends to adopt technology in the administration of road property registration for ease of identification and
tolls to reduce revenue leakages and inefficiencies. valuation of properties.

❑ Revenue Assurance and Compliance Enforcement (RACE) programme to

focus on revenue from imported cargo
• Government plans to intensify assurance on the details of imported cargo on
ICUMS to ascertain its consistency with other sources of information on
commercially imported cargo, uncleared and overstayed cargo to ensure
compliance with customs processes.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK
INITIATIVES

Proposed Non-Tax Initiatives & Revenue Measures

Budget Proposal Our Point of View
Other Revenue Compliance & Administration Measures
❑ Introduce guidelines and procedures for full implementation of the Exemptions The enactment of the exemption act is considered as one
Act, 2022 (Act 1083) of the keys to managing government tax expenditure. It is
• Government plans to issue administrative guidelines for the implementation of the imperative that the administrative guidelines are issued to
Exemptions Act in 2023. ensure a smooth implementation.
AOE has been part of most our petroleum agreements and
❑ Review of tax waivers and exemptions therefore ensuring their effective implementation would be
Government plans to: in the right direction. With the increased global oil prices, a
• Freeze tax waivers for foreign companies. period assessment of such impacts on our local operations
• Review tax exemptions for free zone entities, mining, and oil and gas companies in and the cascading effect on oil revenue, if any is imperative
2023. in our revenue mobilisation drive.

❑ Provide a system for self-clearing of goods by importers at the ports of entry

without recourse to a customs house agent
• Amendment of the Customs Regulations, 2016 (L.I. 2258) to provide for a self-clearing
system, that allows importers to clear goods without recourse to a customs house
agent.

❑ Pursue Additional Oil Entitlement (AOE)

• Additional revenue measures proposed for implementation as part of the fiscal
consolidation programme includes the pursuit of Additional Oil Entitlement (AOE) in
relation to the Jubilee Field.

❑ Enhancing administration mechanisms to improve rent tax compliance.

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06
Expenditure Initiatives
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Expenditure Management Measures

Government, as part of its cost cutting measures, has outlined a number of actions to reduce public expenditure. The following initiatives have been
proposed by Government to limit public spending:
Our Point of View
❑ Migrate all earmarked funds unto the Ghana Integrated Financial ❑ Only items specified in approved Metropolitan, Municipal and District
Management Information System (GIFMIS) platforms and ensure Assemblies (MMDAs’) Procurement Plans posted on the PPA website can
all government agencies use the GIFMIS platform to record all be considered for procurement contracts.
their revenue and process expenditures transactions to minimise
expenditure inefficiencies. ❑ No public official must sign any MOU or agreement that commits the
Government of Ghana financially without prior approval or clearance from
❑ Cap salary adjustment of State Owned Enterprises (SOEs) to be the Minister responsible for Finance.
lower than negotiated base pay increase on Single Spine Salary
Structure for each year. ❑ All procurement approvals by the Public Procurement Authority (PPA), the
Central Tender Review Committee (CTRC) and the Entity Tender
❑ Ban the use of V8s or its equivalent except for cross country Committees (ETCs) relating to a particular fiscal year must be backed by
travel. All government vehicles would have to use GV number budgetary allocations approved for that year.
plates from January 2023.
❑ Introduce financial clearance for the enrolment into teacher and nursing
❑ Allow only essential official foreign travel across government, training institutions to manage the training intake into the two sectors.
including SOEs. There will be no official foreign travel for board
members of SOEs. Accordingly, all government institutions shall ❑ Review the management of financial clearance to among others:
submit a travel plan for the year 2023 by mid-December. • Reflect a net zero hiring impact,
• Be supported by a fiscal impact analysis which shows a net zero fiscal
❑ Placement of moratorium on the creation of new government impact, and
agencies in 2023.
• Control hiring into Education and Health sectors.as part of measures to
control hiring into the public service.
❑ Discontinue the use of public funds for the purchase and
distribution of gift hampers in 2022.

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07
Sector Initiatives
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Trade and Industry

Budget Proposal Our Point of View
❑ Vehicle Assembly and Automotive Industry
• Government envisages three global automotive brands Hyundai, Changan, and Isuzu to
establish assembling facilities in 2023. • Government's efforts towards development of the
automotive industry will enhance job creation and
• The first phase of the Automotive Development Center will be operational in 2023. The
promote local content participation through the local
Automotive Development Council Bill has also been finalised and will be submitted to
manufacture of the components, parts and
Parliament for approval. accessories. More efforts should be geared towards
• In addition to the Automotive Assembly Programme, Government will also launch and creating employment across the value chain.
commence the implementation of the Components Manufacturing Policy in 2023. This Policy
seeks to support the production and supply of components and spare parts for the automotive
industry. • Additionally, given the depreciation of the cedi, the
production of components and spare parts in Ghana
will help reduce cost by eliminating the high cost of
❑ Strategic Anchor Industries Initiatives importing parts and components needed for
• As part of measures to provide support for Micro, Small and Medium Enterprises (MSMEs), assembling these vehicles. Government should
the Government will launch 30 more Business Resource Centers (BRCs) to provide business consider instituting a capacity building plan in
development services to MSMEs in their respective operational zones. collaboration with TVET and tertiary technical
educational institutions to provide the youth with the
• Ghana Enterprises Agency (GEA) will facilitate the creation of about 60,000 jobs through the skills to obtain sustainable jobs in the sector.
provision of business development service and provide support for 10,000 MSMEs to
access affordable credit to expand their businesses.
• The Ministry of Trade will also complete the Textile and Garment Manufacturing and the
Pharmaceutical Manufacturing Policies for implementation.
• GRATIS Foundation (GRATIS) is operationalising five new Technology Solution Centers
(TSCs) to provide product innovation and technology services to industries across the
country. Thus, GRATIS and the existing network of 36 TSCs are being strengthened to
support operators in the light engineering sector.
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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Trade and Industry

Budget Proposal Our Point of View

❑ Trade Development Programme

• Ghana Export Promotion Authority (GEPA) will continue to implement the National Export • Successive governments have prioritised the
Development Strategy to boost exports and harness market opportunities including the evolution of the structure of Ghana’s economy from
AfCFTA. import led to and export driven. Non traditional
exports have a significant role to play in the
• Expansion of products under the AfCFTA Guided Trade Initiative (GTI) to include ninety-six
achievement of this national objective. The AfCFTA
(96) more products, and a yearly review of the Initiative to expand the list of countries.
and the other trade treaties that Ghana is signatory
• Government will support 135 local companies to take advantage of opportunities available to, provide opportunities for Ghanaian businesses to
under AfCFTA. access new markets and generate foreign exchange
• Government also intends to extend the Import Adjustment Tax (IAT) for the next five (5) years to shore up Ghana’s balance of payments position.
to allow member states to recover from the effects of COVID-19 and other prevailing
economic difficulties.
• In this light, GEPA’s effective implementation of the
• Government will continue to strengthen Ghana International Trade Commission (GITC) to National Export Development Strategy is an essential
provide trade remedies to local manufacturers within the framework of World Trade pillar for Ghana’s macro economic stability. It is
Organization (WTO) rules. therefore imperative that GEPA collaborates with and
coordinates capacity building and market access
❑ The Standards Conformity and Assessment Programme programmes with other state actors, development
• Ghana Standards Authority (GSA) to enhance market surveillance activities to reduce the influx partners and the private sector entities for broad
of sub-standard imported products on the domestic market. based impact.

• The Ghana Accreditation Service Bill will also be finalised for approval and implementation.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Transportation
Budget Proposal Our Point of View

❑ Establishment of a Home-based Carrier

The Government has concluded the Shareholders and Partnership Agreements with the • Despite the adverse impact of COVID-19 on the
selected Strategic Partner for the Home-Based Carrier. The airline which will be known as Aviation sector, the current decrease in cases and
“GhanaAirlines” is expected to be operationalised in 2023. the widespread of vaccinations around the world is
expected to gradually pick up global travel and thus,
❑ Planned projects in Aviation Management Programmes having a home-based carrier may prove to be
• The Tamale Airport has been completed and undergoing Operational Readiness and Transfer beneficial to the economy in the long-run. However,
(ORAT). there will be the need for clear policies on
• The draft feasibility report on the Central/Western Region Airport has been submitted and governance and effective management for success.
undergoing stakeholder engagement. • In addition, considering the effect of rising energy
• Government will commence the construction of Phase II of the Sunyani Airport in 2023. prices, increasing cost of living and their constraining
impact on the travel industry, government should
❑ Plan Projects Railway Projects consider the timing of the introduction of the national
• Government intends to complete and operate the 22km Kojokrom-Manso section of the carrier in these conditions and ensure that it has a
Western Railway Line and the 97.97km Tema-Mpakadan Railway Line in 2023. These will be strong value proposition to support the sustainability
the first standard gauge railway lines to be operated in Ghana. of the airline as a viable business.
• Government expects to make significant progress with the construction of the Adum to
Kaase railway line in 2023. • While these planned projects would improve air
connectivity, boost trade and tourism, the
Government would need to assess the funding
requirements given the current economic crisis and
the competing needs for funds for other projects.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Energy and Natural Resources

Budget Proposal Our Point of View
❑ Mineral Resources Development and Management Programme
• The negative impact of illegal mining on the water bodies has been well
• The Minerals Commission to acquire additional marine vessels and recruit
documented. The Commission's initiative to expand surveillance and protect
additional 200 trained river wardens to patrol river bodies and ensure illegal water bodies is a step in the right direction. River wardens should be
miners who are evicted by the military do not return. provided with the requisite logistical support to enhance effective execution
• Government through the Commission will continue to roll out more community of their duties. However, Government needs to ensure the punitive
mining schemes in the mining communities to encourage responsible and measures in place for illegal mining activities are fully enforced by the
appropriate institutions to achieve the objectives of this initiative.
sustainable small-scale mining.
• The Minerals Commission to increase the number of items on the mining • A successful roll out of additional community mining schemes would help
procurement list from 41 to 50. create more direct and indirect jobs in the mining industry. The scheme
should further provide necessary guidelines and offer periodic training
• The Minerals Commission would continue to reclaim more degraded mine sites
programmes on responsible and sustainable mining for the small scale
and maintain its online cadastral system.
miners.
• In a bid to expand the Alternative Livelihood Programme (ALP), the Minerals
Commission would continue to procure and distribute additional hybrid oil-palm • The expanded ALP programme to other areas is expected to generate more
jobs and minimise illegal mining activities. The Government needs to ensure
seedlings to beneficiary farmers in yet to be covered areas.
that the necessary support and structures are put in place to encourage and
• Ghana Integrated Aluminium Development Corporation (GIADEC) will focus on attract more farmers onto the programme. The Commission in conjunction
delivering the mine and refinery solution project and the VALCO retrofit project, as with other relevant authorities such as the Ministry of Agriculture should
defined under the Integrated Aluminium Industry masterplan. also have a pragmatic long term plan that would enable the farmers harness
the full benefits of the oil palm value chain.
❑ New Local Content Regulations
• The minimum capital requirement to be proposed should encourage increased
• The Ghana Stock Exchange and the Minerals Commission are working together local investor participation in the mining industry. The policy should provide
on the new local content regulations that would require mining businesses with a for requisite incentives to promote increased participation of locals in the
specified minimum capital to list on the Exchange. The local content policy would industry. Government may also leverage on experiences from countries that
increase local investor participation in mining companies. have embarked on similar programmes.

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Energy and Natural Resources

Budget Proposal Our Point of View
❑ Power Sector Development and Management Programme
• The Ministry of Energy is committed to the relocation of the 250MW Ameri Power Plant to • Improving and expanding the distribution networks
Kumasi with the aim of improving supply reliability to reduce losses in the middle and
would help enhance the quality and reliability of
northern parts of the national grid.
electricity supply to meet increasing demand.
• The Ministry of Energy, in collaboration with Electricity Company of Ghana, to undertake the Nevertheless, consideration should be given to
Distribution Networks Improvement and Expansion Project in selected districts across the implementing a cost reflective tariff structure to ease
country. the build up of energy sector debt as capacity and
coverage are extended.
• The Ministry of Energy to finalise preparations towards the Accra-Kumasi transmission line,
the Western Corridor Transmission Upgrade Project as well as support the "Government • The Improved Charcoal Cook Stoves Distribution
Goes Solar" project for implementation. Programme can help address the exposure of
women and children to carbon monoxide emissions
• The Ministry of Energy to connect additional 400 towns under the SHEP-4, SHEP-5 and
from the use of wood fuel for cooking as well as
Turnkey Projects. This includes electrification in selected communities in Ahafo, Ashanti,
reduce deforestation. However, it is important that
Bono, Northern, and Upper East Regions.
the cook stoves are tested and quality assured by the
• The Ministry to support the implementation of the Agenda 111 Hospital Infrastructure relevant agencies for safety and energy efficiency.
Programme by providing power to the construction sites.

❑ Renewable and Alternative Energy Development Programme

• The Ministry of Energy to distribute 5,000 units of solar lanterns to rural and peri-urban
communities at a subsidised price, as part of efforts to promote clean lighting.

• The Ministry to supply additional cookstoves 137,253 as part of the Improved Charcoal
Cookstove programme.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Energy and Natural Resources

Budget Proposal Our Point of View

❑ Petroleum Sector Development and Management Programme

• The Ministry of Energy is continually making efforts to ensure that at least 50 percent of The need for a robust cybersecurity infrastructure is critical
Ghanaians have access to safe, clean and environmentally friendly LPG for increased for the prevention, management and provision of timely
domestic, commercial and industrial usage by 2030. As part of these efforts under the response to cybersecurity threats and incidents. Thus, the
LPG for Development (LPG4D) Programme, contracts have been signed for the CSA and CERT would help promote the development and
procurement of 40,000 cook stoves for distribution to beneficiary MMDAs. regulation of cybersecurity in the energy sector to ensure a
secured and resilient digital ecosystem.
• The Ministry of Energy, in conjunction with the Cyber Security Authority (CSA), is
constituting an Energy Sector Computer Emergency Response Team (CERT) to boost the
resilience of critical energy sector infrastructure against cyber-attack.

• Government promoted five offshore blocks for direct negotiation including the Offshore
Cape Three Points South, Shallow Water Cape Three Points, South West Saltpond, Goil
Offshore’s DeepWater Cape Three Points Block, and Base Energy’s Expanded Shallow
Water Tano Block.

• The Ministry to complete the appraisal of the Akoma and Eban discoveries.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Agriculture
Budget Proposal Our Point of View

❑ Ministry of Food and Agriculture Initiatives

• The Ministry will procure a total of 36,360mt of various improved seeds and 366,435mt of
organic and inorganic fertilizers for distribution across the country at subsidized prices in 2023. The current hike in food prices highlighted the
importance of achieving self sufficiency in production of
• Further to this, the Ministry will complete the sale of equipment from Brazil to interested staple foods.
farmers and machinery service providers across the country. It will also commence preparatory
woks for establishing the tractor and backhoe loader assembly plant, while it continues to build The impact of Russia-Ukraine war on the supply of
capacity of machine and equipment operators to ensure effective handling of the machinery. inorganic fertilizer provides an opportunity to explore
the expanded production and use of organic fertilizers
• Again, the Ministry will ensure effective plant protection and pest management by acquiring as a sustainable alternative for food production.
40,000 litres and 6,000kg of insecticides for the control of Fall Army Worm (FAW) and other
pests and disease.
• In addition, as a measure to progressively reduce the over-reliance on chemicals for the control
of the FAW and other pests, the Ministry will rear and release one million parasitoids as
biological agents against FAW.
• The Ministry, through the Tree Crops Development Authority (TCDA), will facilitate the
production and distribution of 5.65 million high quality planting materials of cashew, shea,
coconut, oil palm, mango and rubber to 175,000 tree crop farmers.
• The Ministry, in 2023, under the Rearing for Food and Jobs module of the Planting for Food and
Jobs initiative, will continue with the implementation of its agenda by procuring 2 million broiler
day-old chicks and 8,000 improved breeds of pigs for distribution to out-grower poultry and pig
farmers.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Agriculture
Budget Proposal Our Point of View
❑ Promotion of Organic Fertilizer
• As a result of the disruption in inorganic fertilizer supply chains, the Ministry of Food and Ghana largely imports agricultural products such as rice,
Agriculture is initiating a capacity building programme in Integrated Soil Fertility Management wheat, soybean meal, and poultry, which the country has
(ISFM) for farmers. capacity to produce locally. With Government indicating its
• Further to this, an extensive awareness creation campaign on the use of local organic fertilisers intention to withdraw foreign exchange support for those
will be embarked on. commodities, it is important to accelerate the scaling up of
local production. It is also essential that, supply chain
❑ Regulation of Grain Exports infrastructure is enhanced.

• The Ministry of Food and Agriculture together with the Ministry of Trade and Industry, in their
quest to regulate the export of major staples, especially grain, in other to avoid shortages in the
local markets, will require of grain exporters to acquire Export Permits.

❑ Agribusiness Development Programme

• In furtherance of the support for the rice value chain development, 13,000ha of rain-fed lowland
rice fields will be mapped-out for development.
• The government in 2023, will support agribusinesses involved in rice, soya, tomato and poultry
farming - to complete documentation to enable them enroll with participating banks so that they
can access affordable financing.

❑ Coffee Production
• To facilitate the free distribution of coffee seedlings and facilitate the growth of young plants and
improve the productivity of mature coffee plants, an amount of GHC1.82 million has been
earmarked to support coffee activities in 2022/2023.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Agriculture
Budget Proposal Our Point of View
❑ Export Promotion
• Selected priority products such as cocoa derivatives, cassava value chain products, fruits and
vegetables will be developed for enhanced market access.
Access to financing is a challenge for the agriculture
• The Ghana Exports Promotion Authority (GEPA) will continue with its supply base expansion sector due to the sector’s perceived high risk status.
initiative for products such as coconut, pineapples, cashew and shea derivatives. The implementation of the financing and risk mitigation
• GEPA will leverage on the opportunities the African Continental Free Trade Area (AfCFTA) initiatives will help to de-risk the sector for financing.
provides to pursue aggressive market entry programmes in selected African markets.

❑ Development Bank Ghana and Ghana Incentive-based Risk Sharing for Agricultural
Lending
• The Board of Development Bank of Ghana (DBG) has approved the establishment of a GH¢ 500
million special credit programme – the DBG Emergency Economic Programme (DEEP) to
support businesses in the agribusiness value chain at preferential rates over the next five years
to build economic resilience and lay the foundation for accelerated growth. The priority sectors
include poultry, rice and cereals.

❑ Ghana Agricultural Insurance Pool (GAIP)

• The government projects that US$ 400 million in agricultural insurance will be extended to
eligible commercial and small-holder farmers in 2023 under the GAIP to provide traditional
agricultural insurance and index-based weather insurance products. This will be spearheaded by
the National Insurance Commission.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Health
Budget Proposal Our Point of View
❑ Human Resource for Health Development Programme
• The West African College of Physicians and Surgeons (WACPS) will commence post
graduate training at the Tamale Teaching Hospital in line with the government’s quest to
improve quality of care. To drive good quality health care delivery, it is
imperative that the Government builds adequate human
• The government through the Ministry of Health will finalize the Memorandum of resource capacity to achieve this. Consequently, it is
understanding between itself and the United Kingdom which seeks to regularize the important for Government to continue to expand access
exportation of health professionals. to quality education and in-service training for
healthcare professionals.
❑ Health Sector Regulation Programme
To support the government’s effort to improve the quality of health care in the country, the
government will implement the following strategies:
• The Ghana Psychology Council and Health Facilities Regulatory Agency will complete and
implement the Legislative Instruments for their various Acts (i.e. Part V of the Health
Professions Regulatory Bodies Act, 2013 (Act 857) and the Health Facility Regulatory Agency
for Health Institutions and Facilities Act, 2011 (Act 829)).
• In the area of pharmacy practice regulation, the National Electronic Pharmacy Platform will be
rolled out in 2023 to improve access to medicines and quality pharmaceutical care.
• The traditional Medicine Practice Council will in 2023, launch and implement the advertisement
guidelines on traditional medicine services.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Health
Budget Proposal Our Point of View
❑ Health Service Delivery Programme
• The Ministry will implement the Health Financing Strategy to support financing of the universal
Health Coverage Roadmap. The new reforms in the health sector will enhance
• The Government will continue with the establishment of the National Vaccine Institute and the the quality of health workers and health
Ghana Centre for Disease Control, with a clear cut goal of introducing malaria vaccines in 2023. infrastructure, translating into the improvement of
• Komfo Anokye Teaching Hospital will expand its Nuclear and Radiotherapy Centre, retool the good quality health care delivery in the country. It also
Accident and Emergency Centre, complete the construction of a Fertility Centre as well as set looks at regulating the export of health professionals
up a CathLab and a Cardiothoracic Centre. to other countries, which could be a source of foreign
• Similarly, the Ghana Health Service will implement the Network of Practice concept to ensure
exchange for the country.
that quality health services are provided at the lower levels to promote primary health care.
The government intends to access concessional funding to undertake the following projects,
subject to the conclusion of feasibility studies:
• Phase II of the Accra Regional Hospital Project
• Retooling of Selected Public Health Facilities Project
• Rehabilitation of the Cape Coast Teaching Hospital and
• Accident and Emergency Centre Project

❑ Covid – 19 Update
In 2023, the government will not relent in its efforts to place vaccination as the major Covid-19
prevention strategy while implementing the proven interventions adopted since the outbreak of
the pandemic i.e. surveillance, risk communication, containment and case management as well as
testing and laboratory services.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Financial Services Sector

Budget Proposal Our Point of View

❑ Risk-Based Supervisory Mechanism

• The Financial Intelligence Centre (FIC) plans to enhance the risk-based supervisory mechanism Post-financial sector recovery programme, the financial
of Designated Non-Financial Businesses and Professions. services sector has exhibited resilient performance
despite the elevated macroeconomic risks.
❑ Review of the Securities Industry Act and Development of a Regulatory Framework for Government aims at further managing risks within the
National Home Ownership and Investment Scheme economy, by appointing the Financial Intelligence
Centre to improve the risk based supervisory
• Government plans to review the Securities Industry Act, 2016 (Act 929) and draft an
mechanism of designated Non-Financial Businesses
amendment, develop a business plan, and a legal framework for the establishment of an
and Professions.
Investor Protection Fund. The Ministry of Finance also plans to develop a legal and regulatory
framework for National Home Ownership and Investment Scheme, and pursue a continuous These efforts coupled with the review of the Securities
skills development programme for the Ghana Institute of Securities. Industry Act by government aims at further
strengthening the risk management framework within
the financial services industry and the economy at large.
We urge Government to continuously work through the
respective financial sector regulatory agencies to
monitor activities and stabilize the industry to attain
utmost public confidence.

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Ghana CARES “Obaatan Pa” Initiatives

Phase II of Ghana CARES aims to support the private sector in targeted sectors to accelerate competitive import substitution and export expansion.

Economic Enclave Project

This project is anchored on commercial farming with an objective of significantly expanding Ghana’s productive capacity in rice, tomato, maize, vegetables and
poultry. Below are some achievements of the project:
• Facilitated the acquisition of a 10,000-acre land
• Currently supporting an existing 10,000-acre farm in the Asutsuare -Tsopoli area to cultivate rice and vegetables
• 2,000 acres of land is cleared and currently being developed. Planting of rice on 1,000 acres is expected to be completed by end 2022
• A total of 1.29 million farmers have been biometrically registered and 970,000 biometric cards issued and distributed to registered farmers enrolled on the PFJ
programme

Initiatives to be completed under the Economic Enclave Project in 2023

Partnership agreement Facilitate the full Engage interested

with the MasterCard cultivation of the 20,000- private sector actors to
Foundation to provide acre rice farm in the expand and cultivate the
financial and technical Asutsuare-Tsopoli land in the Asutuare-
support for the enclave Tsopoli area based on
Economic Enclave the Partnership
Project to be concluded Framework..
In 2023, the value of Commence cultivation
in 2023
agriculture loans for on the 50,000 acres in
which credit guarantees the Sekyere Kumawu
will be issued to financial district with a focus on
institutions will be maize and poultry in
increased by GH¢300.7 collaboration with the
million to help smoothen NSS
cost of doing business

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Ghana CARES “Obaatan Pa” Initiatives

Ghana CARES will also support the following targeted areas…
Agriculture

• Work with Development Bank Ghana to provide funding to interested farmers.

• Support Ministry of Food and Agriculture to adopt the farmer registration database
to deploy the farmer input subsidy programme and enhance efficiency.

Manufacturing, Research and Technology

• Support the Ministry of Communication and Digitalisation to establish a tech hub to

improve knowledge in technology and innovation by the youth, in collaboration with
the University of Ghana.
• Promote research, multiplication and commercialisation of locally-bred and climate-
resistant varieties of targeted plants.
• Ensure the operationalisation of a foundry under a sustainable private sector
management framework.
Financial Support

• Support the implementation of the National Unemployment Insurance Scheme.

• Provide interest rate subsidies and direct financing; including supporting prioritised
sectors in the rural economy through the ARB Apex Bank and its network of banks.
Tourism, Arts and Culture

• Support the promotion of tourism through infrastructure refurbishments and

services at tourist attractions.

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08
Outlook
GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Targets for 2023

¢
3.0% ¢
18.9% 0.7%
Overall GDP Fiscal Deficit Import Cover
growth rate

2.8% Non-Oil
GDP growth
7.7% End-
December
3.3
months
Primary
Surplus
rate Inflation

Revenue Fiscal Deficit Expenditure

GH¢ 143.96 billion GH¢ 61.48 billion GH¢ 205.43 billion

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GLOBAL DEVELOPMENTS THE ECONOMY ESG TAX & NON-TAX REVENUE INITIATIVES EXPENDITURE INITIATIVES SECTOR INITIATIVES OUTLOOK

Medium Term Macroeconomic Targets

Medium-term GDP Growth (in %) Projection (2023 – 2026)
A slow down in growth Growth in the A continuous slow down
7 6
is expected in 2023 Agricultural Sector is in growth in the
mainly on the back of expected to accelerate Services Sector is 6
expected to continue in 5
the perceived impact to 2.6% in 2023 from

Sector Growth Rate (%)

GDP Growth Rate (%)

of fiscal adjustment a projected 0.7% in 2023 at 1.7 percent. 5
and the 2022 and average 4.5 Thereafter, the sector is 4
implementation of a percent over the expected to pick up 4
possible debt medium term gradually and record an 3
management strategy between 2024 and average growth rate of 3
as part of measures to 2026. 4.1 percent over the 2
ensure fiscal and debt medium term between 2
sustainability. Overall 2024 and 2026.
1 1
GDP is expected to
grow at 2.8 percent in
2023 with non-oil GDP Growth in the Generally, government 0 0
growth at 3.0 percent. Industry Sector is appears to be adopting 2023 2024 2025 2026
expected to decrease contractionary fiscal Agriculture Industry Services GDP
in 2023 to 3.9 percent. policies such as a
The Sector is expected freeze on recruitment
The economy is to record a sustained into the civil and public
expected to and robust average service and increasing Macroeconomic targets for the medium term (2023 – 2026)
rebound from 2024 medium-term growth the Value Added Tax Indicator Target
and grow steadily in of 5.7 percent, based (VAT) rate by 2.5% from
Overall GDP growth (%) 4.3% (average)
the medium-term to on growth 12.5% to 15%. This is
performances of 6.1 in anticipation of IMF Non-Oil GDP growth (%) 4.0% (average)
record an average
growth of 4.8 percent, 5.1 percent, programme in 2023 to Inflation (%) 8±2 target band
percent over the and 6.0 percent in ensure fiscal and debt Primary balance To be in surplus of 1.3% of GDP
period 2024-2026. 2024, 2025, and 2026 sustainability.
Gross International Reserves 4 months cover
respectively.

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Contact Us:
Anthony Sarpong Andrew Akoto
Senior Partner, Partner, Head of
KPMG in Ghana Markets
Email: asarpong@kpmg.com Email: aakoto@kpmg.com
Mobile: +233 204306718 Mobile: +233 208174629

kpmg.com/socialmedia

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