Consumer Spending Rises as VAT Collections Hit GHS 1.79bn in Value
Consumer spending showed signs of resilience at the start of 2026, with domestic VAT collections and retail sales recording year-on-year growth despite notable month-on-month declines.
According to the March 2026 Monetary Policy Report published by the Bank of Ghana, domestic VAT collections rose by 7.1 percent year-on-year to GH¢1.799 billion in January 2026, up from GH¢1.680 billion recorded in the same period in 2025.
On a monthly basis, however, VAT collections declined by 13.1 percent from GH¢2.069 billion in December 2025, reflecting a slowdown in consumption activity at the beginning of the year.
Retail sales similarly recorded a strong year-on-year performance, increasing by 16.6 percent to GH¢277.88 million in January 2026, compared to GH¢238.38 million in January 2025. Month-on-month, retail sales fell sharply by 41.1 percent, largely reversing gains recorded during the festive season in December.
Manufacturing sector records mixed trends
Developments within the manufacturing sub-sector also pointed to improved activity on an annual basis, supported by growth in tax collections and pension contributions.
Total direct tax collections increased by 9.0 percent year-on-year to GH¢5.802 billion in January 2026, from GH¢5.322 billion in January 2025. On a month-on-month basis, however, collections declined significantly by 64.4 percent from GH¢16.305 billion recorded in December 2025.
A breakdown of tax contributions shows that corporate tax accounted for 40.7 percent of total direct taxes, while income tax including PAYE and self-employed contributions, represented 40.3 percent. Other tax sources contributed the remaining 18.9 percent.
Private sector contributions to the Social Security and National Insurance Trust Tier-1 pension scheme increased by 16.8 percent year-on-year to GH¢551.97 million in January 2026, compared with GH¢472.62 million in the corresponding period of 2025.
Construction activity slows
In contrast, activity in the construction sector weakened during the period under review.
Cement sales – used as a proxy for construction activity – declined by 7.7 percent year-on-year to 206,798.89 tonnes in January 2026, down from 223,936.19 tonnes recorded a year earlier.
On a monthly basis, cement sales remained relatively flat, compared to the 207,929.45 tonnes recorded in December 2025, indicating subdued activity levels.
The contraction in cement sales reflects a slowdown in construction activity at the start of the year, in line with broader seasonal trends and cautious spending patterns across the sector.
