Africa’s top gold producer offers levy cut to smooth path for higher gold royalties

Ghana, Africa’s largest gold producer, is moving to reshape its mining tax regime, seeking a greater share of revenue from the valuable commodity. The country’s finance minister, Cassiel Ato Forson, has proposed cutting a mining levy by two percentage points in an effort to secure industry support for a revised gold royalty structure.

A New Royalty Scale

Currently operating with a flat royalty rate, Ghana plans to implement a sliding scale ranging from 5% to 12%. This new system is designed to allow the state to benefit from rising gold prices, capturing more revenue as the value of the metal increases. The proposed framework mirrors a similar system already in place in Burkina Faso, increasing royalty payments by approximately one percentage point for every $500 increase in gold price.

Miners Respond

Mining companies operating in Ghana have expressed concerns about the potential impact of the new royalties on investment. Kenneth Ashigbey, chief executive of the Ghana Chamber of Mines, stated that industry representatives recently discussed the matter with Minister Forson. While the Chamber initially requested the complete removal of a 3% Growth and Sustainability Levy, the minister offered a reduction of two percentage points.

Did You Know? Ghana’s proposed royalty system would raise royalty payments by about one percentage point for every $500 increase in the gold price.

The 3% levy was doubled last year, and mining firms briefly withheld payment while negotiations continued with the sector regulator. Miners are now advocating for a narrower royalty range of 4% to 8%, with one percentage point allocated to a development fund for host communities. They are also seeking wider price bands to avoid triggering higher royalty rates too quickly, which could impact higher-cost operations.

Expert Insight: Ghana’s actions reflect a growing trend across Africa, where governments are seeking to maximize revenue from their natural resources in response to elevated global commodity prices. This shift highlights the increasing importance of resource nationalism and the evolving relationship between governments and mining companies.

The policy shift is part of a broader effort by Ghana to reshape its mining sector, including the cancellation of several long-term mining agreements and increases to gold royalties. Unless amended by parliament, the new regime is scheduled to take effect 21 days from Tuesday, February 3, 2026, according to Reuters.

Frequently Asked Questions

What is Ghana proposing to change about its gold royalties?

Ghana plans to replace its current flat royalty rate with a sliding scale ranging from 5% to 12%, increasing as gold prices rise.

What is the Ghana Chamber of Mines requesting?

The Chamber is pushing for a narrower royalty range of 4% to 8%, with one percentage point dedicated to a development fund for host communities, and wider price bands.

When is the new regime expected to take effect?

The new regime is set to take effect 21 days from Tuesday, February 3, 2026, unless amended by parliament.

How will these changes impact future investment in Ghana’s gold mining sector?