Ghana’s small-scale gold mining sector generated nearly US$11 billion in foreign exchange earnings in 2025. This significant inflow, however, has not led to a similar increase in government revenue, according to the Institute for Fiscal Studies (IFS).
The IFS criticized the Finance Minister, Dr. Cassiel Ato Forson, for failing to present a clear strategy. This strategy should aim to extract more fiscal value from the sector in the 2026 Mid-Year Budget Review. Small-scale mining accounted for 51.50% of Ghana’s gold exports in 2025, highlighting its economic importance.
This situation reveals a major weakness in the government’s revenue strategy. Ghana’s economy relies heavily on gold exports for foreign exchange and balance of payments support. However, the lack of corresponding tax revenue limits the government’s ability to fund public services and infrastructure projects. This gap is particularly critical as the government seeks to stabilize its public finances.
Dr. Said Boakye, IFS Executive Director, expressed disappointment regarding the budget review. He stated that the review failed to articulate a strategy for increasing revenue from the small-scale mining sector. Dr. Boakye emphasized the sector's critical role and its potential for the Ghanaian economy. He noted that the Bank of Ghana reported small-scale mining generating more than large-scale operations.
The government must now focus on formalizing the small-scale mining sector beyond just regulating gold purchases. This involves creating a transparent fiscal framework to capture royalties, income taxes, and other legitimate state revenues. Such a framework requires careful design to avoid pushing operators back into informal channels or encouraging smuggling. If taxes are too high, they could deter formal participation. If policies only focus on export volumes, the Treasury risks missing out on significant revenue.
GoldBod, a state institution, has already improved the formal purchasing and export of artisanal gold. In 2025, small-scale miners exported 103 tonnes of gold valued at US$10.80 billion through GoldBod. This compares to 96.60 tonnes worth US$9.20 billion from large-scale producers. GoldBod’s growing role provides a foundation for better fiscal integration.
The next steps involve stronger traceability, digital transaction records, and clearer producer identification. Better integration between gold trading and the tax system is also crucial. GoldBod has initiated a traceability program involving approximately 600 artisanal and small-scale mining operations. Effective implementation of such infrastructure could provide authorities with reliable data on production and sales. This data is essential for taxing a sector historically difficult to monitor.
The IFS concern is further amplified by broader weaknesses in the national budget. Government expenditure for the first half of 2026 reached GHS 136.94 billion, falling short of the GHS 172.54 billion target. This represents a GHS 35.60 billion shortfall, or 20.60%. Capital expenditure was particularly affected, reaching GHS 22.18 billion against a GHS 36.56 billion target. Dr. Boakye warned that low revenue inflows are impacting government spending on key sectors. This situation will likely affect overall budget planning and the implementation of government policies. The need for increased revenue from all sectors, especially small-scale gold mining, is therefore paramount for Ghana’s fiscal health.