Boosting mining investment: Ghana to scrap 25-year-old tax on mineral exploration

Ghana plans to scrap a tax on minerals exploration and reconnaissance to boost investment in its mining sector.

The country is the biggest gold producer in Africa, and one of the top ten in the world.

With this move, Ghana is taking a very different direction to South Africa, where it's mining beneficiation that is in the spotlight, comments Africa business specialist Rutendo Hwindingwi.

Speaking during deliberations in the runup to the G20 Summit, Minister of Mineral and Petroleum Resources Gwede Mantashe said South Africa and the rest of the continent cannot be part of a race to the bottom, where Africa produces raw materials at low prices that are set on global markets and add little value to its economies.

RELATED: Mantashe says SA can’t fall short on value addition amid growing calls for mineral beneficiation

Ghana's Finance Minister, Cassiel Ato Forson, told Parliament during the recent 2026 budget presentation that 'abolishing VAT will revive investor confidence, stimulate greenfield activity, and ensure the long-term sustainability of the country’s mining sector'.

Ghana's government wants to scrap this 25-year-old tax to incentivise not only the big corporates but also the small-scale players, Hwindingwi says.

"In the last ten months $8.1 billion has been delivered by small-scale exporters of gold in Ghana compared to corporates who've produced less at $6.6 billion."

He highlights the impact of gold smuggling, which costs Ghana billions in revenue.

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"So, there is a lot of money out there and the leadership of Ghana is saying - similar to Burkina Faso, Ivory Coast and Kenya, 'let's help in terms of creating incentive for people to do it right and boost production. It's a bold step, but hopefully one in the right direction'.

Ghana's Chamber of Mines welcomed the proposal to remove the tax on mineral exploration.

The organisation told Reuters that VAT 'negatively affected our competitiveness as a mining jurisdiction and was a clog on the pipeline of projects'.

Scroll up to the audio player to listen to Africa Business Focus (Ghana discussion at 1:54)