The Tourism sector in Ghana has been one of the thriving sectors over the years before COVID-19. However, post-COVID-19, the sector seems to be rebounding.
According to the Ghana Statistical Service, Ghana’s overall gross domestic product (GDP) for 2021 was 459,131 million cedis. The services sector continues to contribute the highest to Ghana’s GDP, contributing about 210,882 million Cedis, representing about 49 per cent of the total GDP in 2021.
One sub-section of the services sector is accommodation and food services. This sector saw a sharp decline in 2020 due to the COVID-19 pandemic.
The Bank of Ghana’s updated Composite Index of Economic Activity (CIEA) recorded an annual growth of 15.8 per cent in March 2022, compared to 26.3 per cent in the corresponding period in 2021 due largely to increased industry products, increased production, increased credit to the private sector, exports and higher tourist arrivals (Mid-year budget 2022).
The 2022 quarterly GDP estimates show that the sector is rebounding and commercially viable.
The schedule to the Tourism Act, 2011 Act (817) lists tourism enterprises to include;
• Tourist Accommodations
• Places where food, beverages and entertainment services are provided.
• Night Clubs and theatres
• Travel Trade Enterprises
• Banquet Facilities
• Conference Facilities
• A Spa
• A Tourist Site
• A Resort and
• Any other tourist-related enterprise.
Ghanaians who want to do business in this sector must first register their business with the Registrar of Companies (ROC), the Ghana Tourism Authority and their local authority, to be issued a Business Operating Permit.
Meanwhile, operators of food businesses are required to undertake mandatory health screening.
There are authorities and agencies like the Food and Drugs Authority, Environmental Protection Agency, Ghana National Fire Service, etc. that operators must seek permits from.
Business Profit in the tourism sector is taxed at 25 per cent, except for hotels, which are taxed at 22 per cent. Businesses in this enterprise are required to withhold taxes on goods and services they purchase from suppliers. If a business fails to withhold the taxes, the Ghana Revenue Authority will recover the money from it with penalties.
Business enterprises are also required to charge Value Added Tax (VAT) at the standard rate, as their activities constitute the provision of service and a one per cent tourism levy to patrons of their services.
Investors are also taxed on gains on their investments in the businesses. These often take the form of dividend tax and capital gains tax.