Ghana may have forgone about GH¢2 billion in withholding tax revenue as a result of incentives introduced under the Ghana Gold Board (GoldBod) programme, Senior Lecturer at the University of Ghana and Executive Director of the Centre for Policy Scrutiny, Dr Adu Owusu Sarkodie, has estimated.
He said the forgone revenue should form part of any comprehensive assessment of the economic cost of GoldBod, arguing that the public debate has so far focused too narrowly on the reported US$1.7 billion, equivalent to about GH¢22 billion, associated with the programme.
Dr Sarkodie said policymakers must assess both the direct and indirect costs of the GoldBod model against the benefits it has generated for the economy.
“One of the costs for the programme, the fees, the charges, the exchange rate differential, the foregone tax, 1.5% withholding tax foregone, that’s about GH¢2 billion foregone,” he said.
He noted that the estimated GH¢2 billion tax revenue had largely been excluded from discussions about the programme’s financial performance.
“And that’s even; it’s not been accounted for in all our conversations. Our conversation has been set on a 1.7 billion, GH¢22 billion. It should be higher,” he said.
Tax incentive
The 1.5% withholding tax on gold purchases was removed under the government’s 2025 tax reforms as part of measures accompanying the GoldBod initiative.
The government has explained that the tax relief was intended to encourage small-scale miners and other gold sellers to channel their output through formal state-backed buying arrangements, thereby helping to reduce gold smuggling and strengthen the country’s control over its gold trade.
Dr Sarkodie, however, said the revenue forgone through the tax exemption should be recognised as part of the cost of achieving those policy objectives.
He described the tax relief, alongside other incentives incorporated into the GoldBod model, as “giveaways” that should be included in a proper evaluation of the programme.
“The design of the programme is very generous. It has too many giveaways,” he said, pointing to premiums, discounts, fees, charges and exchange-rate differentials as additional costs.
According to him, while such incentives may have been necessary to attract gold sellers into the formal system and enable GoldBod to pursue its strategic objectives, government must now determine whether the cost of those incentives can be reduced without undermining the programme.
“We should make sure that we get a lower loss or cost of transaction for that,” he said.
Broader cost-benefit analysis
Dr Sarkodie urged policymakers to move beyond the narrow question of whether GoldBod has made a profit or incurred a loss and undertake a comprehensive cost-benefit analysis of the initiative.
He said such an assessment should capture direct financial costs, forgone tax revenue, opportunity costs and environmental costs, while also accounting for the wider economic benefits generated by GoldBod.
Among the benefits that should be measured, he identified GoldBod’s contribution to foreign exchange management, gold reserve accumulation, formalisation of the gold trade and efforts to reduce smuggling.
He said these benefits were important in determining whether the programme had delivered value for money, even if some of its policy interventions carried significant fiscal and financial costs.
“The design of the programme is very generous,” he reiterated, stressing the need for government to examine how its cost structure could be made more efficient while preserving the gains achieved.
$1.7bn controversy
His comments come amid a continuing dispute between the government and the opposition Minority over GoldBod’s financial performance.
The Minority has accused GoldBod of incurring losses of approximately US$1.7 billion, with Minority Leader Alexander Afenyo-Markin citing an International Monetary Fund report in support of the claim.
GoldBod Chief Executive Officer Sammy Gyamfi has rejected the allegation, insisting that the institution has not incurred losses and has instead generated profits.
The competing claims have intensified calls for greater clarity on GoldBod’s financial position and the actual economic impact of its operations.
Dr Sarkodie’s intervention adds another dimension to the debate, arguing that even an assessment that establishes GoldBod’s profitability would not necessarily provide a complete picture of its economic value.
He said the analysis must account for the fiscal concessions and other incentives used to attract gold into the formal market, as well as the broader benefits arising from the programme.
The central policy question, he said, should therefore be how to reduce the cost of the GoldBod model while preserving its gains, particularly in strengthening Ghana’s gold reserves, improving foreign exchange management and formalising the small-scale gold trade.
A comprehensive assessment, he added, would provide policymakers and the public with a clearer basis for determining whether the benefits of GoldBod justify the financial and fiscal costs associated with its implementation.
