High Taxes and Levies Make Ghana a Costly Destination, Hindering Potential Growth
Ghana’s tourism industry has received mixed reviews from tourists, with nearly 44 percent considering it expensive according to the 2023 Ghana Tourism report. Among this group, 7.85 percent from the US, UK, Nigeria, and domestic sources rated Ghana as very expensive, while an additional 36.13 percent rated it as expensive. However, 15 percent found it less expensive, and 18 percent deemed it not expensive, with the remaining describing it as normal compared to countries in the sub-region.
The report attributes Ghana’s perceived expense to the numerous taxes and levies imposed on the tourism and hospitality industry. With almost 20 taxes in place, Ghana is seen as a costly tourist destination in West Africa compared to similar destinations on the continent. Despite being ranked as the most visited country in West Africa by Tripadvisor, Ghana’s tour packages and hotel rates remain high.
Accommodation costs, which account for nearly 80 percent of tourists’ budgets, are particularly high. The average expenditure on accommodation per week is almost $500, especially in non-starred facilities. The Ghana Hotels Association has cited the high-cost structure, driven by the numerous taxes and levies, as a major challenge in setting hotel rates.
Taxes such as NHIL, VAT, GETfund, COVID-19 tax, GTA tax, EPA tax, FDA tax, MMDA tax, Fire Service tax, 1 percent tourism tax, SSNIT for personnel, data protection tax, BOPs Tax, property taxes, suitability tax, and GHAMRO tax significantly impact pricing in the hotel industry. Despite these challenges, Ghana aims to increase international tourist arrivals to around two million in 2024, up from 1.1 million in the previous year.
In 2023, international tourist arrivals reached 1.1 million, with US citizens comprising 39 percent, Ghanaians residing abroad at 33 percent, the United Kingdom at 16 percent, and Nigeria, Germany, and South Africa at 6 percent, 6 percent, and 4 percent respectively. With over 37 international airlines operating through Kotoka International Airport and attractions such as forts and castles, the Ghana Tourism Authority believes the country remains an attractive destination. However, there are concerns among industry players regarding Ghana’s perception as an expensive destination.