Ghana's consumer spending exhibited a mixed performance in March 2026, according to the Bank of Ghana's May 2026 Monetary Policy Report. Domestic Value Added Tax (VAT) collections increased by 35.7% year-on-year to GHS 2.064 billion, compared to GHS 1.521 billion in March 2025.
Total domestic VAT for the first quarter of 2026 rose by 20.8%, reaching GHS 5.818 billion from GHS 4.815 billion in the same period last year. Conversely, retail sales moderated by 1.9% year-on-year, declining to GHS 262.84 million in March 2026 from GHS 268.00 million. This mixed outcome suggests a nuanced picture of consumer activity, where some spending areas show growth while others face headwinds.
This performance fits into Ghana's broader economic narrative of balancing revenue generation with consumer purchasing power. Increased VAT collections usually signal robust taxable consumption, which is positive for government revenue. However, moderating retail sales, even with a monthly improvement, could indicate underlying pressures on household budgets. For instance, Ghana's economy grew by 6.0% in 2025, but the impact of this growth on diverse consumer segments is varied.
The Bank of Ghana's May 2026 Monetary Policy Report highlighted these trends, providing crucial data for economic analysis. The report noted that the overall decline in year-on-year cement sales was primarily due to a moderation in construction activities. Consistent monitoring of these indicators helps policymakers gauge economic health.
Moving forward, analysts will closely watch these consumer metrics to determine the trajectory of Ghana's economic recovery and stability. A continued decline in construction activity or further moderation in retail sales could signal broader economic challenges, potentially influencing interest rate decisions and fiscal policies. Decision-makers will need to evaluate if the robust VAT collections are sustainable or if they mask deeper issues in consumer confidence.
Activities in the manufacturing sector showed improvement in March 2026. This was measured by direct tax collections and private sector worker contributions to the SSNIT Pension Scheme. Total direct taxes collected increased by 40.6% year-on-year to GHS 12.269 billion in March 2026. This is up from GHS 8.724 billion recorded in March 2025.
Cumulatively, direct taxes for the first quarter of 2026 rose by 20.4% to GHS 22.830 billion. Corporate tax accounted for 65.7% of these taxes, while income tax contributed 20.9%. This positive manufacturing trend partially offsets the mixed consumer spending signals.
The construction sector, however, faced a notable downturn. Cement sales, a key proxy for construction activity, declined by 10.7% year-on-year in March 2026. Sales dropped to 226,629.10 tonnes from 253,754.47 tonnes in March 2025. Cumulatively, first-quarter cement sales decreased by 10.0% to 636,283.18 tonnes. This reduction points to reduced investments in new buildings and infrastructure. Such a deceleration in construction activities, if sustained, could impact job creation and related industries.