Government hints at reviewing VAT imposed on mining exploration costs

The Minister of Lands and Natural Resources, Samuel Abu Jinapor, has hinted at plans by the government to conduct a review of the Value Added Tax (VAT) component of the build-up imposed on mining exploration costs for prospective mining companies.

According to the sector minister, this review has become necessary to address concerns about the high tax burden imposed on costs associated with the exploration of natural mineral resources.

Speaking at the opening ceremony of the 2024 West African Mining and Power Conference and Exhibition (WAMPOC / WAMPEX) program, the Lands Minister stated that the move aims to attract foreign direct investment while making the mining sector more attractive.

“We are, for example, working with the Ghana Revenue Authority (GRA) and the Ghana Chamber of Mines, under the guidance of the Government’s Economic Management Team, to explore the best framework for treating critical imposts such as Value-Added Tax (VAT) on exploration,” Abu Jinapor said.

He continued, “If properly structured, it will reduce the financial burden on exploration companies, making it more attractive to invest in exploration while safeguarding the nation’s interest.”

Samuel Abu Jinapor emphasised that this move is part of the government's efforts to create a conducive environment for the exploration of natural resource deposits and the mining sector as a whole.

MA/NOQ