Ghana Chamber of Mines Urges Review of Mining Fiscal Plan to Protect Investment and Long-Term Revenue
The Ghana Chamber of Mines warns that proposed changes to mining taxes and royalties could deter investment and reduce output, urging a balanced fiscal framework that grows revenue sustainably.
Ghana Chamber of Mines Calls for Review of Mining Fiscal Plan
The Ghana Chamber of Mines has urged the government to adopt a more balanced and growth-oriented fiscal framework for the mining sector, warning that proposed changes to royalties and taxes could discourage investment and weaken long-term revenue generation.
While acknowledging the government’s objective of increasing national benefits from mineral resources—especially at a time of strong gold prices—the Chamber cautioned that the current direction of reforms risks constraining industry growth. It argued that without careful calibration, the new fiscal measures could reduce reinvestment, limit production expansion, and ultimately undermine the very revenue goals they are meant to achieve.
The concerns follow comments by the Chief Executive Officer of the Minerals Commission, Isaac Tandoh, in a recent Reuters interview, where he outlined proposals to scrap mining stability agreements and introduce a new sliding-scale royalty regime. Under the proposed framework, royalties would start at around nine percent and rise to as much as 12 percent depending on commodity prices and other conditions.
In a statement, the Chamber said it was not opposed to reforms aimed at ensuring Ghanaians derive greater value from their mineral wealth. However, it stressed that fiscal policy must strike a delicate balance between boosting state revenue and preserving the competitiveness of the mining industry.
High gold prices, the Chamber argued, should be a catalyst for growth across the entire mining value chain—from exploration and extraction to processing, logistics, and community development. But overly aggressive fiscal measures could have the opposite effect, deterring capital reinvestment at a moment when expansion should be encouraged.
Kenneth Ashigbey, Chief Executive Officer of the Ghana Chamber of Mines, said the industry understood the rationale behind a sliding-scale approach to royalties but believed the current proposal fell short of achieving a sustainable equilibrium.
“Our members are not opposed to the government seeking greater returns for Ghanaians,” Ashigbey said. “However, the current proposal does not achieve a position where revenues increase while companies are able to reinvest and expand output.”
According to him, the structure of the proposed changes risks discouraging reinvestment by mining companies, even as higher commodity prices should ideally be driving expansion, employment, and value creation.
A Heavy Tax Burden Already
The Chamber emphasized that Ghana’s mining sector is already subject to one of the highest effective tax burdens globally. Large-scale mining companies currently pay a three percent Growth and Sustainability Levy on gross revenue, in addition to royalties that are also charged on gross revenue rather than on profits.
Beyond these, firms are required to provide a 10 percent free carried interest to the state, pay a 35 percent corporate income tax, and remit an eight percent dividend tax. When combined with a five percent royalty on gross revenue, these obligations place Ghana high on the global Average Effective Tax Rate for mining.
The Chamber warned that raising royalties to a sliding scale of between five percent and 12 percent on gross revenue could significantly worsen this burden. Such a move, it said, may lead to reduced investment, delayed projects, lower output, and potential job losses.
Mining is a capital-intensive industry with long investment horizons. Companies often commit billions of dollars upfront before any returns are realized. Fiscal stability and predictability are therefore critical in attracting and retaining investment.
“Imposing higher charges on gross revenue, regardless of profitability, increases operational risk,” the Chamber noted. “In periods of high costs or lower grades, companies may struggle to remain viable, even when market prices appear favorable.”
Risk to Long-Term Revenue
The Chamber argued that while higher taxes may boost government receipts in the short term, they could erode the sector’s capacity to generate revenue over time. Reduced reinvestment could mean fewer new projects, slower expansion of existing mines, and a contraction in exploration activity.
This would have knock-on effects across the economy. Mining supports thousands of direct and indirect jobs, underpins export earnings, and sustains communities through procurement and development programs. Any policy that dampens the sector’s growth trajectory could weaken these contributions.
Rather than focusing solely on immediate fiscal gains, the Chamber urged policymakers to consider the long-term health of the industry and the broader economy.
“A sustainable framework should ensure that as prices rise, both the state and industry benefit,” Ashigbey said. “The objective should be to grow the pie, not merely to take a larger share of a shrinking one.”
Stability Agreements and Investor Confidence
On the proposal to scrap mining stability and development agreements, the Chamber expressed strong reservations. While supporting a review of these instruments, it opposed their complete abolition.
Stability agreements, it argued, are vital in an industry characterized by high upfront capital costs and extended project lifecycles. They provide investors with certainty on fiscal and regulatory conditions, enabling long-term planning and financing.
The Chamber suggested that these agreements could be strengthened and refined—much like previous reforms to tax exemptions—rather than removed entirely. Eliminating them, it warned, could undermine investor confidence and make Ghana less attractive relative to competing mining jurisdictions.
“Certainty is as important as competitiveness,” the Chamber said. “In the absence of predictable frameworks, capital will simply flow to countries where the rules are clearer and more stable.”
Dialogue and Partnership
Despite its concerns, the Chamber welcomed the ongoing engagement by the Ministry of Lands and Natural Resources and emphasized the importance of continued dialogue. It said that constructive consultation with industry stakeholders is essential to crafting reforms that serve both national and commercial interests.
The mining sector, the Chamber noted, has historically been a cornerstone of Ghana’s economy. With the right policies, it can continue to drive growth, employment, and development—while also delivering fair and rising returns to the state.
The group called for a collaborative approach that recognizes the shared objective of national prosperity. In its view, public revenue and private investment are not competing goals but interdependent outcomes.
As Ghana seeks to maximize the benefits of its mineral resources in a period of strong global demand, the Chamber’s message is clear: reform is necessary, but it must be carefully designed. A fiscal regime that balances fairness with competitiveness, and ambition with realism, will be essential to ensuring that both the state and the mining industry thrive over the long term.
