Audio By Carbonatix
Vision for Accelerated Sustainable Development (VAST) Ghana has called on the government to introduce more ambitious excise tax reforms in the 2026 Mid-Year Budget Review, arguing that higher taxes on tobacco, alcohol, sugar-sweetened beverages and ultra-processed foods would improve public health while strengthening domestic revenue mobilisation.
The public health advocacy organisation said the country's recent excise tax reforms had demonstrated that well-designed health taxes could simultaneously increase government revenue and reduce the consumption of harmful products.
In a press statement issued on July 20, VAST Ghana commended the Ministry of Finance and the Ghana Revenue Authority (GRA) for implementing the Excise Duty Amendment Act, 2023, describing it as a landmark reform that has significantly enhanced tax collections.
According to the organisation, tobacco excise revenue rose from about GH¢176 million in 2022 to GH¢371 million in 2023, representing a 107 per cent increase, while collections reached GH¢713 million by 2025, a 305 per cent increase over the 2022 level.
It added that excise tax receipts from sugar-sweetened beverages climbed to GH¢1.081 billion in 2023 and GH¢1.675 billion in 2024, demonstrating the fiscal benefits of the reforms.
Public health burden
Despite the gains, VAST Ghana said tobacco use and unhealthy diets continue to exact a heavy toll on the country's health system and economy.
It noted that tobacco-related diseases claim more than 6,700 lives annually in Ghana while costing the economy an estimated GH¢668 million each year. The organisation further observed that non-communicable diseases linked to tobacco, alcohol and unhealthy diets account for more than 94,000 deaths annually, representing over 45 per cent of all deaths nationwide.
Recommendations
To address the challenge, VAST Ghana proposed increasing the specific excise tax on cigarettes from the current GH¢0.28 to GH¢1.00 per cigarette, saying the measure would move Ghana closer to the World Health Organization's recommendation that taxes account for at least 70 per cent of retail cigarette prices.
It also urged the government to adopt automatic annual adjustments to tobacco taxes to reflect inflation and economic growth, replace paper tax stamps with digital systems to strengthen enforcement, and introduce hybrid excise tax regimes for alcohol, sugar-sweetened beverages and other unhealthy products.
The organisation further called for the introduction of excise taxes on ultra-processed foods high in sodium, sugar and unhealthy fats, arguing that such products contribute significantly to the country's growing burden of non-communicable diseases.
VAST Ghana also advocated earmarking a portion of revenue generated from health taxes to finance disease prevention programmes, health promotion, smoking cessation initiatives, primary healthcare and the Ghana Medical Trust Fund.
It said experiences from other African countries, including Ethiopia, demonstrate how dedicated health tax revenues can strengthen public health systems while reducing long-term healthcare costs.
'Protect public health'
The Executive Director of VAST Ghana, Labram Musah Massawudu, urged policymakers to resist pressure from industries opposed to higher excise taxes.
"Ghana cannot afford to let industries that profit from addiction and disease dictate our national tax policy. The 2023 reforms were a great start, but to truly protect our youth and the poor, we must increase the excise tax on tobacco, implement a hybrid system for alcohol and sugar products and introduce excise tax on ultra-processed foods, and ensure that the money collected goes directly back into saving Ghanaian lives."
VAST Ghana pledged to work with the Ministry of Finance, the Ghana Revenue Authority, the Ministry of Health, the Food and Drugs Authority and other stakeholders to advance the proposed reforms.
The organisation further urged government to reject industry arguments against higher excise taxes, maintaining that stronger enforcement and improved governance—not lower taxation—remain the most effective tools for tackling illicit trade while protecting public health.
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