Introduction to the Modified Taxation Scheme (MTS)
The Ghana Revenue Authority (GRA) has introduced a new Modified Taxation Scheme (MTS) aimed at making tax registration and payment more accessible, efficient, and transparent for businesses in the informal sector. This initiative is part of a broader effort to bring thousands of small and medium enterprises (SMEs) into the national tax net while improving understanding of tax compliance across the country.
Key Features of the MTS
At the launch event held in Accra, Commissioner-General of the GRA, Anthony Kwasi Sarpong, emphasized the importance of this scheme. He stated that the MTS reflects the Authority’s commitment to modernizing tax administration through technology and simplification. The scheme offers a fair, predictable, and convenient way for micro, small, and medium businesses to comply with tax laws. It reduces bureaucracy, limits discretion, and builds trust between taxpayers and the GRA.
Under the MTS, individuals and businesses earning up to GHC500,000 annually will pay a flat tax rate of 3 percent. For example, a business making GHC200,000 a year will pay GHC6,000, while someone earning GHC25,000 will contribute GHC750 in taxes. This structure ensures that the tax burden is manageable for smaller entities.
Streamlining Compliance Processes
Mr. Sarpong explained that the MTS streamlines the compliance process—from registration to payment—making it easier for traders, artisans, and small business owners to fulfill their tax obligations without the usual bureaucracy. This convenience is expected to bring significant benefits to small enterprises and enhance domestic revenue mobilization for national development.
Sustained Tax Education Programme
Alongside the MTS, the GRA launched a Sustained Tax Education Programme. This initiative is designed to nurture a culture of voluntary tax compliance. Under a three-year national plan, the programme will provide citizens with practical training on how to register, file, and pay taxes accurately and on time.
Unlike traditional outreach methods, the campaign will target markets, schools, universities, professional associations, and digital platforms, integrating tax awareness into everyday social life. Mr. Sarpong noted that when citizens understand the value of paying taxes, compliance becomes a natural choice—not an obligation enforced by law.
Support from Government Officials
Deputy Minister of Finance, Thomas Nyarko Ampem, welcomed the initiative, highlighting its focus on Ghana’s vast informal sector, which accounts for about 80 percent of the economy. He acknowledged that compliance has been low over the years but expressed optimism that the MTS and sustained tax education would change this narrative.
He added that boosting domestic revenue mobilization is critical to achieving Ghana’s medium-term fiscal targets. Stressing that tax compliance is a shared national duty involving government, businesses, and citizens alike, he emphasized the importance of collective efforts.
Representation from the President’s Office
Representing President John Mahama as guest of honour, Chief of Staff Julius Debrah commended the GRA for its innovation in tax collection. He expressed optimism that the Authority would meet its GHC189 billion revenue target for the year. As of September 2025, the GRA had already collected GHC180.6 billion, with the new tax scheme expected to help close the gap.
“We build roads, equip our security agencies, and drive growth through the taxes we pay. National development depends on our collective contribution,” he added.
Understanding the MTS
The MTS is not a new tax but a simplified form of personal income tax targeted at informal sector workers whose incomes are generated solely within Ghana and who are not registered for VAT. The system operates through a digital platform, accessible via the MTS mobile app or by dialling *880#. Users can register using their Ghana Card, digital address, phone number, and business details, and make payments easily through mobile money.
With this initiative, the GRA aims to transform tax compliance into a simple, transparent, and technology-driven process, ensuring every cedi paid contributes directly to Ghana’s development.