Mining Tax Burden Threatens Ghana’s Competitiveness, Chamber Warns

 

Ghana’s mining industry is facing mounting pressure from what operators describe as one of the highest fiscal burdens among major mining jurisdictions, raising concerns about the country’s ability to attract new investment, extend the lifespan of existing mines and remain globally competitive.

The warning came from the immediate past President of the Ghana Chamber of Mines, Michal Edem Akafia during the Chamber’s 98th Annual General Meeting in Accra, where industry leaders reviewed the sector’s operating environment and policy developments over the past year.

According to the Chamber, mining companies contended with significant cost pressures in 2025, driven by the appreciation of the cedi, higher operational expenses and increased statutory levies. External factors, including rising input costs linked to geopolitical tensions in the Middle East, also weighed heavily on operations.

The Chamber noted that recent changes to Ghana’s fiscal regime have further increased pressure on mining firms.

Government raised the Growth and Sustainability Levy from one percent to three percent before subsequently reducing it to one percent in March 2026. At the same time, the mineral royalty framework was revised from a fixed five percent rate to a sliding-scale system ranging between five and seven percent for mines operating without development agreements.

While the reduction in the Growth and Sustainability Levy was welcomed by industry players, the Chamber argued that the revised royalty regime significantly increases the overall fiscal burden during periods of high commodity prices.

When combined with corporate income tax, the State’s free-carried interest and other statutory obligations, the Chamber estimates the effective tax burden on mining companies now ranges between 54 and 58 percent.

Industry leaders warned that such levels could affect project profitability, discourage fresh capital investment and reduce the industry’s capacity to undertake mine-life extension projects, particularly at mature and high-cost operations.

The Chamber said the situation places Ghana among countries with the highest effective mining tax regimes globally and could undermine efforts to maintain the country’s attractiveness as a mining destination.

It has therefore renewed calls for a comprehensive review of the mining fiscal framework to ensure government revenue objectives are balanced against the sector’s long-term sustainability and competitiveness.

Beyond taxation, the Chamber also expressed concern over the state of development in many mining communities.

Despite the mining sector’s position as one of Ghana’s largest contributors to export earnings and domestic revenue, the Chamber said living conditions in several mining areas remain inconsistent with the wealth generated from the country’s mineral resources.

The industry body reiterated its long-standing proposal that at least 30 percent of mineral royalties should be returned directly to mining communities to support local development.

It further renewed calls for the establishment of a Mineral Revenue Management Act to provide a transparent and accountable framework governing the collection, allocation and utilisation of mining revenues.

The Chamber also welcomed ongoing government efforts to review the Minerals and Mining Act, describing the consultative approach adopted by the Ministry of Lands and Natural Resources and the Minerals Commission as encouraging.

However, it stressed that any reforms must preserve the industry’s long-term competitiveness while maximising national benefits from Ghana’s mineral resources.

The concerns come at a time when the mining sector remains a critical pillar of Ghana’s economy, contributing significantly to export earnings, government revenue and foreign exchange inflows. Industry leaders say maintaining a stable and competitive policy environment will be crucial if Ghana is to sustain investment and capitalise on growing global demand for minerals.