Ghana’s Tax System Is Failing Women

Ghana recently implemented significant tax reforms to promote equity, improve compliance, and drive economic growth. However, these tax policies remain gender-blind. They amplify inequality for women, especially those in the informal sector, who are already marginalized. Despite contributing significantly to Ghana’s economy, these women face regressive taxes, arbitrary tolls, and inconsistent levies. To achieve tax equity in Ghana, the government must develop gender-inclusive tax policies, empower local market associations to manage fair tolls, and link taxes to benefits such as healthcare and social protection.

Women drive Ghana’s informal economy. Yet, the tax system is punishing women instead of supporting them. The women endure arbitrary undocumented levies varying by location. Sometimes, they pay overlapping charges without understanding the purpose for the payments. This lack of transparency encourages extortion and distrust in tax authorities. There are no tangible benefits like healthcare, sanitation, and proper infrastructure.

Ghana’s tax-to-Gross Domestic Product ratio rose from 10 to 12 percent over the past decade to about 18 percent in 2025. Notwithstanding, this progress hides deeper inequalities. Tax policies are designed without input from stakeholders, such as traders. Women in the informal sector, especially, bear hidden costs from these policies. A 2023 study by Anyidoho found that the 2022 E-Levy, for example, increased transaction costs for informal traders without improving services. Women-led businesses reported higher financial strain and no gains in market security or infrastructure. In November 2023, the government’s action on Value Added Tax on sanitary pads was a step in the right direction. However, isolated progress does not guarantee institutional reform. Tax reforms must recognize and respond to these gendered impacts to be truly just.

To build a fairer tax system, Ghana’s tax reforms must intentionally include women. This inclusion should begin by involving women traders and civil society organizations in tax policy design. Currently, reforms often happen without consultation with those the reforms affect the most. Creating forums where market women can share their experiences will lead to more inclusive and practical policies.

Local market associations also need greater autonomy and digital tools to ensure transparency. Transparent revenue collection methods, including the use of digital receipts and fixed rates, will build trust and reduce corruption. It will also encourage feedback and promote trust. Associations that understand the daily realities of traders can manage digital tax systems more effectively. Empowering women traders means decentralizing collection while ensuring oversight from municipal authorities.

Finally, taxation should offer something in return. If women see direct benefits from their contributions, such as access to microcredit, healthcare, and social security, they will be more likely to comply. Linking informal taxes to meaningful social programs can transform taxation from being a burden to an investment. For example, women who regularly pay market tolls could qualify for business grants or enroll in low-cost health insurance schemes. These benefits will build resilience and show the government values their labor.

If Ghana continues to ignore the gendered effects of tax policies, the same inequalities it aims to reduce will persist. Ghana should reform tax policies through a gender lens, empowering local actors and linking tax payments to tangible benefits.

By Irene Ofori-Agyeman

Irene Ofori-Agyeman is a writing fellow at African Liberty.

 

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