Local Goods Inflation Rises Despite Tax Relief, GNCCI CEO Warns Pressure Persists

Inflation for locally manufactured goods has risen despite tax relief measures designed to ease business costs, signalling that production pressures remain unresolved even as the broader business environment improves, the Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI) has said.

Mark Badu-Aboagye, speaking on Joy News' PM Express Business Edition on Thursday, November 5, 2026, said the increase in local goods inflation tempered an otherwise positive assessment of business conditions. "If you look at the numbers, the cost of locally manufactured goods, the inflation for it went up a bit, which should tell you that we are still not out of the woods yet," he said .

A Budget That Helped—But Not Enough

Badu-Aboagye described the 2026 budget as largely business-friendly, noting that tax relief had benefited both businesses and consumers. "Relatively, business has been good. Things are a bit better as compared to previous years," he said. He also pointed to lower interest rates as a source of relief, adding that businesses had contributed to single-digit inflation by limiting price increases.

But the latest Ghana Statistical Service data vindicates his caution. Locally produced items recorded inflation of 6.9 percent in October 2026, nearly triple the 2.4 percent rate for imported goods, and accounted for 86.4 percent of the overall inflation rate . The headline rate rose to 5.5 percent, marking a third consecutive monthly increase, driven largely by services inflation, which jumped to 11.5 percent from 8.3 percent in September . Transport recorded the highest divisional inflation at 14.1 percent .

When challenged by the host over whether the national average masked divergent consumer experiences, Badu-Aboagye defended his use of the average. "No, so that's why we use the average. So the national average is 5.5 per cent," he said, acknowledging that some regions recorded higher inflation but maintaining that prices had been broadly stable on average .

Exchange Rate Stability and the Tariff Gap

Badu-Aboagye attributed the moderation in headline inflation partly to exchange rate stability and improved production costs. The cedi has held steady against the dollar in recent weeks, trading at approximately 11.67 to the dollar, supported by improved interbank liquidity and softer corporate foreign-currency demand .

However, he argued that further tariff reductions, alongside the tax relief already implemented, could have helped bring inflation for locally manufactured goods down. "Inflation would have been a bit lower," he said .

The 2026 budget introduced a series of tax reforms aimed at easing business costs, including a reduction in the effective VAT rate from 21.9 percent to 20 percent, the abolition of the COVID-19 Health Recovery Levy, and an increase in the VAT registration threshold to GH¢750,000. The Finance Ministry projected these measures would return approximately GH¢3.7 billion to individuals and businesses in 2026 .

Regional Disparities

The national average conceals significant regional variation. The Ashanti Region recorded inflation of 9.7 percent in October, while the Northern Region registered negative 0.5 percent, meaning prices there were lower than a year earlier . The Bank of Ghana has maintained its policy rate at 14 percent since March, with its next decision scheduled for November 18 .

For Badu-Aboagye, the message is one of qualified relief: the trajectory is positive, but the pressure on Ghanaian manufacturers has not yet eased enough to declare the battle won.