GSE Boss Urges Scrapping Capital Gains Tax on Listed Securities to Boost Ghana Investments

Introduction

In a bold move to revitalize Ghana’s financial markets, Abena Amoah, Managing Director of the Ghana Stock Exchange (GSE), has called for the complete removal of the capital gains tax on listed securities. This proposal aims to eliminate a major barrier to market growth and draw more investors into the ecosystem. Delivered during the 10th anniversary celebration of the Ghana Fixed Income Market (GFIM), her address highlights the need for policy reforms to enhance liquidity, deepen market participation, and spur economic development.

The Ghana Stock Exchange plays a pivotal role in the nation’s capital markets, facilitating equity and fixed-income trading. GFIM, launched in 2013, has become a cornerstone for government and corporate bonds. Amoah’s advocacy for scrapping the capital gains tax—currently levied on profits from selling listed securities—positions it as a game-changer for boosting investments in Ghana. This initiative aligns with broader efforts to recover from economic challenges, including the Domestic Debt Exchange Programme (DDEP) of 2023.

Why This Matters for Investors

Reducing or eliminating capital gains tax on listed securities could lower transaction costs, making Ghana’s stock market more competitive regionally. Investors often seek tax-efficient environments, and this change could signal Ghana’s commitment to a investor-friendly financial landscape.

Analysis

Abena Amoah’s call for zero capital gains tax on listed securities addresses a longstanding issue in Ghana’s capital markets. Capital gains tax, which applies to profits realized from the sale of assets like stocks and bonds, discourages frequent trading and long-term holding. By advocating for its removal, the GSE MD argues it would attract more traders, increase market depth, and enhance liquidity.

Impact of Capital Gains Tax on Market Dynamics

In many emerging markets, including Ghana, taxes on investment gains can stifle participation. Data from the GSE shows GFIM’s cumulative trading volumes exceeding 1.2 trillion Ghana cedis since inception. However, volumes dropped from 230 billion cedis in 2022 to 98 billion cedis in 2023 due to the DDEP, which restructured domestic debt amid Ghana’s economic crisis. By October 2025, trading rebounded to 214 billion cedis, indicating resilience but underscoring the need for incentives like tax relief.

GSE’s Broader Vision for Market Growth

Beyond tax reform, Amoah outlined three additional measures as part of a comprehensive strategy. These include enabling viable State-Owned Enterprises (SOEs) to raise long-term capital through GFIM and GSE platforms, providing incentives for cross-border firms to localize ownership via listings, and promoting public-private partnership (PPP) bonds for infrastructure, such as municipal bonds and pension fund allocations to capital-intensive projects. This holistic approach aims to strengthen corporate governance, reduce fiscal pressures, and mobilize domestic savings.

Economically, scrapping capital gains tax could mirror successes in markets like Kenya or Nigeria, where tax exemptions on certain securities have boosted listings and trading activity. In Ghana, it would complement ongoing capital market reforms post-DDEP, fostering a more vibrant investment climate.

Summary

At the GFIM’s 10th anniversary event, GSE Managing Director Abena Amoah proposed scrapping the capital gains tax on listed securities to boost investments and market depth. She emphasized four key reforms: zero capital gains tax, Cabinet approval for SOE fundraising via GSE platforms, incentives for foreign firms’ local listings, and PPP infrastructure bonds. GFIM’s trading volumes highlight recovery potential, with cumulative trades over 1.2 trillion cedis and a strong rebound in 2025.

Key Points

Practical Advice

For investors eyeing opportunities in Ghana’s stock market, consider these steps amid calls for capital gains tax reform:

Getting Started with GSE Investments

Open a brokerage account with a licensed GSE trading member. Focus on listed securities like government bonds via GFIM, which offer stable yields. Monitor GSE announcements for policy updates, as tax changes could enhance returns on equities and fixed-income instruments.

Strategies for SOE and Infrastructure Exposure

Anticipate SOE listings post-Cabinet approval; diversify into blue-chip firms. Allocate to PPP bonds for infrastructure plays, leveraging pension funds’ growing role. Use dollar-denominated securities to hedge currency risks.

Monitoring Market Recovery

Track GFIM volumes and DDEP impacts. Platforms like the GSE website provide real-time data. Engage financial advisors familiar with Ghana’s capital gains tax regime for personalized portfolios.

Long-term, zero capital gains tax could make holding periods more rewarding, encouraging buy-and-hold strategies in undervalued sectors like energy and telecoms.

Points of Caution

While promising, these proposals face hurdles. Policy changes require government approval, and fiscal constraints may delay implementation.

Post-DDEP Volatility

The 2023 DDEP caused a sharp trading volume decline, highlighting debt restructuring risks. Investors should assess sovereign credit ratings and inflation trends.

Tax and Regulatory Risks

Current capital gains tax rates apply until reforms; verify with the Ghana Revenue Authority. Market depth remains nascent compared to equities, so liquidity risks persist in fixed-income trades.

Economic Context

Ghana’s macroeconomic stability is key. Watch IMF program adherence and cedi performance, as external shocks could impact GSE attractiveness.

Comparison

Ghana’s proposed capital gains tax removal on listed securities contrasts with regional peers. Nigeria exempts taxes on gains from stocks listed on the Nigerian Exchange for up to five years, boosting activity. Kenya offers similar incentives for bonds, aiding market depth.

GFIM vs. Equity Market

GFIM focuses on fixed-income (bonds), with higher volumes (214 billion cedis in 2025 YTD) than GSE equities, which trade smaller daily turnovers. Tax relief could bridge this, aligning fixed-income appeal with equities.

Pre- and Post-DDEP Performance

Cumulative GFIM volumes surpass equity trades, underscoring fixed-income dominance.

Legal Implications

Scrapping capital gains tax on listed securities requires amendments to Ghana’s Income Tax Act, 2015 (Act 896), under the Ghana Revenue Authority’s purview. Cabinet and Parliamentary approval are essential for fiscal policy shifts, especially involving SOEs governed by the State Interests and Governance Authority (SIGA) Act.

Compliance and Oversight

Any tax exemption must align with IMF agreements, as Ghana’s Extended Credit Facility emphasizes revenue mobilization. Investors benefit from double taxation treaties, but changes could trigger reviews. Consult legal experts for binding rulings on gains from GSE-traded assets.

Conclusion

Abena Amoah’s daring call for scrapping capital gains tax on listed securities, alongside SOE reforms and PPP incentives, positions the GSE as a catalyst for Ghana’s investment revival. With GFIM’s proven track record—over 1.2 trillion cedis traded—these measures could unlock domestic and foreign capital, enhance governance, and drive infrastructure growth. As markets rebound post-DDEP, stakeholders must advocate for swift implementation to capitalize on this momentum. Investors prepared for policy evolution stand to gain from a deeper, tax-efficient Ghana Stock Exchange.

FAQ