New Excise Law Threatens 80,000 Farmers, 5,000 Jobs – Analysts Warn

A recently enacted tax law in Ghana, the Excise Act 2026, is causing widespread concern among industry leaders and economic analysts, who warn of severe consequences for the beverage and agricultural sectors. The Act, signed into law on July 26, 2026, has been criticized for its abrupt implementation without any industry consultation.

Industry insiders argue that it will lead to a 25 percent increase in beer and stout prices, causing a collapse in local demand for raw materials and forcing consumers to turn to unregulated and untaxed black market alcohol.

Over 80,000 cassava, maize, and sorghum farmers are expected to lose their primary buyers in the form of breweries. The specialized sorghum projects, launched by Ghana's leading brewers in partnership with international development agencies for the benefit of 30,000 smallholder farmers, are also at risk. The new excise regime threatens to devastate the livelihoods of these farmers, who have already faced a recent "haircut" in their incomes.

One particularly perverse aspect of the Act is its punitive measures against local investment. The Local Raw Material (LRM) sliding-scale tax adjustment favors imported finished products over locally sourced materials, discouraging breweries that have invested in local sourcing and agro-processing. This perverse incentive undermines the very value chain the government claims to support and directly contradicts the administration's goal of promoting a 24-hour economy and rural job creation.

Government's stated objective to curb tax leakages may backfire as the higher prices for legal beer push consumers towards cheaper and unregulated illicit alcohol. This illicit trade poses significant health risks while providing no revenue for the state, resulting in a lose-lose situation for the economy, public health, and safety.