Government is weighing a return of the Value Added Tax (VAT) waiver for vehicles assembled in Ghana.
The rethink comes after automakers warned that scrapping the incentive has cut output and put investments in the sector at risk.
The Head of Strategic Manufacturing at the Ministry of Trade, Agribusiness and Industry, Kwasi Ofori-Antwi, disclosed this at the Citi Business Festival 2026 Roundtable on Thursday, June 25, 2026, on Channel One TV.
The session ran under the theme, “Driving Ghana Forward: The State of the Automotive Assembly Industry and Its Contribution to the Economy.”
“There was an assessment on the industry by the Ministry of Finance and the Ministry felt that the VAT which was to be enjoyed by consumers was not trickling down to industry so that was put on hold. The industry people have engaged the Ministry of Finance to that effect. “Government didn’t want industry to hold on to that perception. So government will be reviewing that and we are very hopeful that it will be restored.”
Assemblers say the 20% VAT on local builds has made them less competitive against imports. They warned that the levy could push plants to reduce shifts and endanger hundreds of skilled engineering and technical roles.
The tax, they argued, also undercuts the goals of the Ghana Automotive Development Policy.
Background
In 2018, Ghana rolled out the Ghana Automotive Development Policy to draw global carmakers to set up assembly lines locally. The plan was part of a broader push for industrial growth, tech transfer, skills training and job creation. To attract investment, government offered perks like a zero-rated VAT on locally assembled cars and import duty cuts of five to 10% on parts and components used in assembly.
Those incentives brought several global brands to open plants in Ghana, expanding the manufacturing supply chain.Industry leaders have long said steady policy is key to keeping investor trust and ensuring the sector’s future.
Stakeholders insist Ghana’s assembly industry is still young and needs ongoing backing to scale, boost local content, and hold its own under the African Continental Free Trade Area (AfCFTA). Restoring the VAT waiver would likely be welcomed by assemblers, helping drive demand for local cars and position Ghana as a strong auto hub in West Africa.
