Accra: Civil society organisations (CSOs) led by Vision for Accelerated Sustainable Development, Ghana (VAST-Ghana), have called on the government to maintain the current excise tax rates on unhealthy products, to safeguard public health. 'Any attempt to reduce the excise tax on tobacco, alcohol, and sugar-sweetened beverages (SSB) would worsen public health crises and hike healthcare expenditure,' they said.
According to Ghana News Agency, the CSOs urged the Ministry of Finance to resist any pressure from the tobacco, alcohol, SSBs, and plastic industries to reduce the excise tax rate as it prepares to present the Mid-Year Budget Review for 2025 on Thursday, July 24, 2025. They emphasized their strong endorsement of retaining the current excise tax rates and even suggested an increase.
A statement signed by Mr. Labram Musah, the Executive Director of VAST-Ghana, highlighted that reducing excise taxes would reverse health gains and undermine fiscal benefits achieved between 2023 and 2024. It argued that this would send wrong signals to investors and the public about Ghana's commitment to international obligations.
The statement referred to the WHO Framework Convention on Tobacco Control (FCTC) Articles 6 and 5.3, which advocate for resistance to industry interference in policymaking and strong taxation measures to reduce tobacco demand. It warned that reducing excise taxes could negatively impact the 'Ghana Medical Trust Fund,' potentially increasing non-communicable diseases (NCDs) cases and leading to the fund's unsustainability.
Since the Excise Duty Amendment Act's implementation, Ghana Revenue Authority (GRA) data showed significant fiscal responses. Excise revenue from SSBs surged from GHS 735 million in 2022 to GHS 1,325.6 million in 2023, with combined revenue from tobacco, alcohol, and SSBs estimated at over GHS 1.5 billion. Before full implementation, tobacco excise grew by 106% from May 2022-April 2023 to May 2023-April 2024, despite tax waivers on tobacco products from the ECOWAS region.
The revenue growth demonstrates the excise tax system's effectiveness and potential for financing public health initiatives targeting NCDs. The modelled health and revenue impact highlighted dual gains, reinforcing fiscal deterrents' efficacy in reducing unhealthy product intake, particularly among lower-income populations.
The excise reform adhered to ECOWAS directives and was supported by administrative enhancements such as robust excise stamps and customs procedures, mitigating illicit financial inflows. The statement emphasized that the Public Health Act, 2012 mandates the state to enact measures promoting healthy nutrition and limiting harmful substances, with the excise framework already delivering measurable returns.
The CSOs, backed by comprehensive evidence, recommended that the Ministry of Finance uphold the current excise tax rates on tobacco, alcohol, and SSBs as per the Excise Duty Amendment Act, 2023. They suggested considering an upward review of excise taxes and earmarking a portion of the revenue generated for public health initiatives, including disease prevention, health promotion, and healthcare infrastructure.
They also proposed allocating a portion of the excise tax revenue to support the Ghana Medical Trust Fund, specifically for financing NCDs. The CSOs urged the government to prioritize public health over commercial interests, as industry arguments for tax reductions often overlooked broader societal costs and long-term economic benefits.
The statement called for government investment in and strengthening of enforcement mechanisms to combat illicit trade effectively, ensuring the full realization of public health and revenue objectives without compromising the tax system. It also recommended establishing a robust framework for continuous monitoring and evaluation of the impact of excise taxes on public health outcomes, consumption patterns, and revenue generation.
The statement concluded by urging Ghana to maintain and consider indexing excise to inflation at current rates, ensuring fiscal responsibility and reinforcing the country's commitment to public health amid industry pressures.
