The Ghana Chamber of Mines has pushed back against recent justifications for increasing the Growth and Sustainability Levy (GSL), saying that they misrepresent the mining industry’s contribution to the national economy.
Government recently raised the GSL from 1% to 3% in the 2025 Budget, arguing that the country has yet to fully capture economic rent from its natural resources, particularly in the wake of rising global gold prices. However, the Chamber contends that this narrative overlooks key facts.
“Some reports suggest that extractive sector rents represent 14% of gross domestic product while extractive sector revenue accounts for approximately 1.5% of GDP,” the chamber said in a statement.
“These statistics encompass the entire extractive sector.”
Citing World Bank data, the Chamber noted that mineral rents specifically averaged below 3% of GDP between 1990 and 2021, ranging from 2.4% in 2015 to 5.2% in 2021.
It also emphasised the difference between mineral rent and revenue. “Mineral rent is a residual value, the excess revenue from mineral extraction after covering all costs, including investor returns,” the Chamber said.
“It cannot exceed mineral revenue, nor can its GDP ratio surpass that of mineral revenue.”
According to the Chamber, mineral revenue from its member companies contributed about 8% of Ghana’s GDP in 2024.
The mining industry body further argued that mineral rents are not captured solely by investors but are shared among stakeholders, including government, local communities and mining companies. It cited the Natural Resource Governance Institute (NRGI) which estimates that Ghana’s government captures around 50% of mineral rent, with some figures suggesting it could be over 60%.
“These figures show that mining companies already contribute significantly under the existing fiscal regime,” the Chamber said.
While gold prices have surged in recent years, the Chamber warned that not all mining firms have benefitted equally. Variations in operational costs and investment levels mean some companies have not seen meaningful profit increases.
The Chamber also raised concerns that the revised GSL places an uneven burden on the sector. Producers of other minerals like manganese and bauxite, which have not enjoyed gold’s price boom, will also be affected by the higher levy.
“We have consistently raised concerns about the levy since its introduction and maintain our position following the rate hike,” the statement said.
Despite its objections, the Chamber said it remains open to dialogue and is committed to working with the Ministries of Lands and Natural Resources and Finance to ease the impact on struggling companies while supporting broader government revenue goals.
On the issue of ownership structure and fiscal framework of the mining sector, the Chamber asserted that it has evolved in response to changing economic, social and environmental priorities.
“During the 1960s and 1970s, government nationalised or took controlling interests in mining companies under the State Gold Mining Corporation (SGMC). However, SGMC faced severe financial and operational challenges, leading to a 60% decline in national mineral production and a 45% drop in mining employment between 1970 and 1982.”
This downturn, it said, contributed significantly to the country’s economic crisis in the 1980s.
“To revitalise the sector and attract investment, government divested state-owned mines and introduced new legal frameworks. The current lease-based royalty-tax system remains the predominant global model for mining sector agreements.”
The Chamber said it welcomes discussions on alternative legal and fiscal structures for the sector, including increased state participation. However, any changes must consider lessons from past experiences.
Also, it observed that between 2020 and 2023 member companies spent an average of US$2.87 billion annually on locally sourced goods and services, while tax contributions and corporate social investments averaged US$1.19 billion and US$32 million.
These domestic expenditures, it maintained, are the primary channels through which mineral revenues support national development.
“From 2020 to 2023, approximately 75% of mineral revenues were repatriated through local financial institutions, countering claims that investors retain a disproportionate share offshore.
To enhance transparency and accountability in mineral revenue management, the Chamber has been advocating a legislative framework similar to the Petroleum Revenue Management Act for the mining sector. “
It said such a policy would highlight mining’s significant role in national development.
