The government has formally endorsed a landmark constitutional reform that would require the President to pay income tax on salary and allowances while in office, ending a long-standing tradition of executive tax exemption. However, it has drawn a firm line against taxing the President’s retirement gratuity and pension, the Attorney-General and Minister for Justice, Dr. Dominic Ayine, announced on Thursday.
Speaking to journalists in Accra, Dr. Ayine detailed the government’s response to the Constitutional Review Committee’s (CRC) recommendations, which were submitted after a nationwide consultative process. The committee had proposed that the President, like all other citizens, should be subject to the full tax regime, arguing that privilege of office should not confer fiscal immunity.
“The Government has accepted the principle that the President should not enjoy tax exemptions by virtue of office alone,” Dr. Ayine stated. “The President will pay tax on salary and allowances, as well as the applicable indirect taxes on goods and services.”
A Historic Shift in Fiscal Culture
Currently, Article 71 of Ghana’s 1992 Constitution grants the President and certain other high-ranking officials immunity from income tax on their official emoluments. This provision has long been a subject of public debate, with critics arguing it undermines the principle of equality before the law and sets a poor example for citizens.
The CRC’s recommendation to scrap this exemption was among its most politically sensitive proposals. By accepting it, the government signals a commitment to transparency and accountability, aligning with broader calls for fiscal discipline in the public sector.
Pension and Gratuity Off-Limits
Yet, the government has drawn a clear boundary on retirement benefits. Dr. Ayine confirmed that the proposal to tax the President’s gratuity and pension has been rejected outright.
“The Government has not, however, accepted the proposal to tax the President’s retirement gratuity and pension,” he said, noting that the details of the President’s tax liability would be worked out in the tax laws, “where such details belong.”
This decision likely reflects concerns over the potential erosion of post-service financial security for former heads of state, as well as the constitutional protections often afforded to pensions. It also suggests a nuanced approach—ensuring the sitting President contributes to the national coffers while preserving the dignity and stability of retirement packages.
Next Steps: Legislation and Implementation
The government’s response is now expected to shape a series of constitutional and legislative amendments, which Parliament will debate in the coming months. While the principle has been accepted, the specific tax rates, thresholds, and mechanisms for collecting the President’s taxes will be codified in the broader tax laws rather than in the Constitution itself.
Dr. Ayine did not specify a timeline for the rollout, but the announcement marks a significant step in the ongoing constitutional review process, which has sought to modernise governance structures and enhance public trust.
Public Reaction and Implications
Civil society groups and tax advocacy organisations have largely welcomed the move, applauding the government for ending a perk that many viewed as anachronistic. However, the exclusion of pensions may draw further debate, with some arguing that all presidential benefits should be subject to the same rules as those of ordinary citizens.
For now, the government’s position is clear: the President will pay income tax, but the state will continue to honour his retirement with untaxed gratuity and pension—a compromise that seeks to balance equity with executive privilege.
