Amazon Web Services (AWS) will introduce a 21% tax on cloud services for customers in Ghana, effective March 1, 2025. This tax, comprising a 15% Value Added Tax (VAT) and an additional 6% in levies, will increase operational costs for Ghanaian startups reliant on AWS for data storage and digital operations.

The tax hike may put Ghanaian startups at a competitive disadvantage compared to their counterparts in regions with more favorable financial conditions for cloud adoption.

Ghana’s broader tax landscape has long posed challenges for startups, with multiple levies and compliance costs affecting business operations.

The new tax could push Ghanaian startups to explore alternative cloud providers or on-premises infrastructure solutions, potentially slowing their growth and innovation cycles.

Despite these challenges, forecasts suggest resilience in the market, with Ghana’s public cloud sector projected to reach $306.10m in revenue in 2025.

Ghana’s vibrant startup ecosystem, home to hundreds of startups, depends heavily on affordable cloud services for development and deployment.

The new AWS tax threatens to undermine the affordability of these critical services, posing a significant challenge for Ghanaian startups.