Business leaders and policy experts have intensified calls for government to overhaul Ghana’s regulatory framework, warning that excessive fees, duplicated taxes and punitive enforcement practices are stifling enterprise growth and driving legitimate businesses toward informal arrangements.
Seth Adjei Baah, former president of the Ghana National Chamber of Commerce and Industry (GNCCI), expressed frustration at what he described as needless regulatory pressure that pushes struggling entrepreneurs to breaking point. He argued that the system makes compliance unnecessarily difficult while failing to generate intended revenues.
“Some of the things are not necessary as a private sector operator. There is duplication of taxes. Multiple taxes, and they don’t help,” Baah said. He recounted instances where businesses overwhelmed by unreasonable charges resort to informal arrangements with government officials simply to survive, while those insisting on following rules often face closure.
The concerns gained prominence at recent policy forums, including a pre-budget dialogue organized by the University of Professional Studies, Accra (UPSA), where economists and business experts argued that so called nuisance taxes continue to undermine enterprise development. Participants emphasized that formal firms paying Value Added Tax (VAT) and multiple levies face unfair competition from businesses operating outside regulatory oversight, creating an imbalance that weakens compliance and undermines revenue mobilization.
The Institute for Liberty and Policy Innovation (ILAPI) released research findings in late November 2025 that paint a stark picture of regulatory costs. The study, conducted between September 2024 and July 2025, surveyed 600 micro, small and medium enterprises (MSMEs) across manufacturing, information and communications technology, and tourism sectors.
Results showed that many businesses spend between 30 and 40 percent of annual revenue on regulatory compliance, including registration, licensing, permits and unofficial payments to intermediaries known as goro boys. ILAPI Executive Director Peter Bismark Kwofie warned that Ghana’s regulatory architecture has become too costly and hostile for the private sector.
The research revealed that the average MSME spends GH₵1,030 to register a business, GH₵1,275 to secure permits from metropolitan, municipal and district assemblies, and up to GH₵10,100 to acquire licenses. Some firms reported costs as high as GH₵20,000. Beyond direct expenses, delays compound the burden, with 40.8 percent of MSMEs waiting more than a month to receive registration certificates despite official timelines of 14 working days.
ILAPI’s findings indicate that if the average MSME loses 30 percent of working capital or profits to regulatory compliance, each business loses the ability to employ at least three people. With over one million MSMEs operating in Ghana, this translates to a potential loss of three million jobs annually.
The report highlighted that 57.3 percent of surveyed MSMEs were operating without required licenses at the time of the study, not by preference but because formalization costs proved prohibitive. Ghana’s informal sector, which contributes an estimated 70 percent to gross domestic product (GDP) and employs 86.4 percent of the population, continues expanding precisely because entering the formal sector remains too expensive.
Baah stressed that strengthening the private sector remains the only realistic path to expanding employment opportunities and reducing economic hardship. However, he insisted that regulators must shift from punitive authorities to facilitators of growth.
“If we want our private sector to grow and create the needed employment, these unnecessary barriers must be addressed,” Baah said, emphasizing the urgent need for reforms balancing enforcement with practicality and fairness.
At ILAPI’s High Level Business Regulatory Dialogue held in Accra on November 27, 2025, Senior Presidential Staffer Nana Yaa Jantuah acknowledged government commitment to removing regulatory bottlenecks. She noted that entrepreneurs often rely on middlemen because many regulatory institutions remain difficult to reach or insufficiently visible to the public.
Kwofie called for greater collaboration, harmonized systems and seamless information sharing among regulatory bodies to improve the business environment. He warned that inefficiencies in the regulatory system slow investment inflows, weaken productivity and limit Ghana’s ability to drive economic integration and global competitiveness.
The regulatory concerns come as the government prepares its 2026 budget, with businesses hoping for concrete measures addressing compliance costs while maintaining necessary oversight. Finance Minister Dr Cassiel Ato Forson has committed to comprehensive VAT reforms and digitalizing tax administration, though critics argue broader regulatory reform beyond taxation remains essential.
Business leaders maintain that Ghana risks slowing its own development trajectory if regulatory pressures continue unchecked, with young entrepreneurs increasingly diverting capital toward migration abroad rather than investing in local enterprises.
