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Double taxation – Tax experts are urging the Ghana Revenue Authority (GRA) to exercise caution as it rolls out a controversial plan to tax the foreign income of Ghanaians living abroad. While the initiative is seen as an important step in broadening the country’s tax net and mobilizing more domestic revenue, analysts caution that without proper safeguards, it could trigger widespread double taxation risks and erode public trust in the system.
GRA Intensifies Efforts to Tax Overseas Income
The GRA has revealed that it has already issued over 1,000 letters to Ghanaians holding assets or earning income overseas. These letters direct recipients to reconcile their foreign tax payments with obligations in Ghana.
According to Commissioner General Anthony Sarpong, this initiative is part of a global shift in tax administration. Through the automatic exchange of information framework, Ghana now receives direct reports on assets and earnings of its residents abroad from partner countries. This allows the GRA to track offshore wealth and close loopholes that have undermined revenue collection for years.
“This is an area where we have put it in very high gear,” Mr. Sarpong stated during the 2025 Annual International Tax Conference on August 23, 2025. “Today, if you have investments and assets and you are earning income outside Ghana, we do receive this information. We are working to ensure that if taxes are already paid outside, we can compare them with what should be paid in Ghana. Where there is a differential, Ghana must earn its fair share.”
The GRA believes this new system could significantly widen the tax net, boost non-oil revenue, and support fiscal consolidation at a time when the country is under pressure to raise more domestic resources.
Analysts Welcome Plan but Warn of Double Taxation
While tax experts acknowledge the GRA’s commitment to improving compliance, they warn that rushing the process could harm taxpayers and discourage compliance.
Speaking to the Press, tax analyst Francis Timore Boi welcomed the idea of broadening the tax net but emphasized that strong safeguards must be in place to prevent double taxation.
“We must apply the tax treaties properly to prevent duplication of tax payments,” he explained. “Education should be the first step, because not every flagged account belongs to a taxable Ghanaian resident. Mistakes could damage trust and discourage people from willingly paying taxes.”
Mr. Boi further stressed the importance of accurate data collection and interpretation. According to him, some accounts flagged as belonging to Ghanaians may actually be linked to non-residents or individuals no longer subject to domestic tax laws.
Importance of Public Education in Overseas Income Taxation
One of the biggest concerns among tax analysts is that many Ghanaians abroad may not even be aware that they are required to declare foreign income in Ghana. Without a deliberate effort to educate the public, the new policy could be seen as punitive rather than progressive.
“Finally, if enforcement is perceived as punishment for lack of awareness, it could backfire,” Mr. Boi cautioned. “The GRA should focus on encouraging compliance, not discouraging it.”
Analysts recommend that the GRA should embark on aggressive public education campaigns, both locally and across the diaspora, to explain the rules, tax treaty benefits, and available safeguards. This would help build confidence in the process and ensure voluntary compliance instead of forced compliance.
How Tax Treaties Can Prevent Double Taxation
Ghana has signed double taxation agreements with several countries. These treaties are designed to prevent citizens from being taxed twice on the same income. However, proper application of these treaties is key.
For example, if a Ghanaian living in the UK already pays taxes on income earned there, the treaty should ensure that the same income is not taxed again in Ghana. Instead, the GRA should only tax the differential, if any.
Tax experts insist that unless these treaties are applied consistently and transparently, the new policy could end up punishing honest taxpayers who are already contributing to the economies of their host countries.
The Bigger Picture: Ghana’s Revenue Mobilization Drive
Double taxation – Ghana’s aggressive push to tax overseas income is part of broader efforts to strengthen revenue collection amid a challenging economic climate. With mounting debt obligations and limited space for new borrowing, the government is under pressure to find sustainable revenue streams beyond oil and traditional exports.
The diaspora, which sends billions of dollars in remittances every year, has become a key focus. Analysts estimate that properly structured taxation of foreign income could generate significant revenue. However, the potential for backlash remains high if the system is not transparent, fair, and clearly explained.
Analysts Urge Balance Between Enforcement and Trust
Ultimately, tax experts believe the GRA must strike a delicate balance between enforcing compliance and maintaining public trust. Heavy-handed enforcement without adequate education risks being counterproductive.
The message from analysts is clear: taxation of overseas income must be done carefully, transparently, and in line with international best practices. Anything less could result in distrust, legal battles, and resistance from Ghanaians both at home and abroad.
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