Ghana’s 2019 tax on artisanal gold miners triggered widespread smuggling that cost the nation $11.4 billion in lost exports, according to a SWISSAID report published June 11.
The 3% withholding tax, intended to formalize revenue from small-scale mining, instead drove most producers to bypass official channels entirely.
Official data reveals a startling discrepancy: while Ghana recorded just 67.3 tonnes of gold exports to the United Arab Emirates from 2019-2023, UAE import logs show receiving 296.7 tonnes from Ghana. This 229-tonne gap, representing 77% of total flows, exposes the policy’s catastrophic failure. “This massive mismatch illustrates the unintended consequences of poorly designed tax policy in the artisanal mining sector,” the report states.
The collapse of formal gold exports began immediately after the tax’s implementation. Ghana’s artisanal sector, which produces over 40% of the nation’s gold, operates with minimal oversight, making taxation difficult to enforce. Miners and traders quickly shifted operations to neighboring countries, particularly Togo and Burkina Faso, where they could avoid the levy.
Though the government reduced the tax to 1.5% in 2022 and repealed it completely in March 2025, the damage to Ghana’s formal gold trade persists. The report estimates 34 tonnes of artisanal gold production went unrecorded in 2023 alone, nearly matching that year’s official sector output.
The failed policy highlights fundamental challenges in regulating artisanal mining across Africa. Without robust monitoring systems, taxation often pushes informal sectors further underground. Ghana’s experience demonstrates how well-intentioned fiscal measures can backfire when implemented without considering on-the-ground realities in artisanal mining communities.
As Ghana implements new reforms through its Ghana Gold Board initiative, experts emphasize the need for systems that track gold from mine to market. With global gold prices remaining high, effective regulation of the sector has become both more difficult and more crucial for the West African nation’s economic stability.
