Packaged Water Producers Demand Suspension of New Excise Tax, Warn of Price Hikes and Industry Pressure

As Ghana ushers in a raft of mid-year fiscal measures, the country’s packaged water industry is raising alarm over what it calls a redundant and punishing new tax policy.

The National Association of Sachet and Packaged Water Producers (NASPAWAP) is urging the Ministry of Finance to immediately suspend the newly introduced 5% excise tax on plastic packaging, which took effect on July 1. The Association describes the levy as a duplication of an already existing 10% environmental excise tax at the ports one that’s been in place since 2011.

In a statement co-signed by NASPAWAP National President Magnus Nunoo and Director of Corporate Affairs Kwame Agyapon-Ntra, the group warned that the policy will exacerbate the cost of doing business and push up prices for an essential commodity in an already strained economy.

“We strongly believe that this new tax duplicates the existing 10% environmental excise tax. This duplication of taxes will unnecessarily burden our members and ultimately, the final consumer.”

 the statement read.

Water or Wealth Drain? Industry Caught Between Tax and Sustainability Goals

While acknowledging the government’s environmental objectives, NASPAWAP argues that the path toward sustainability should not come at the expense of affordability or business viability. The Association emphasized that its members are not opposed to environmental taxation in principle, but insists the new tax structure amounts to “double taxation.”

“We support taxation aimed at improving environmental outcomes but we cannot endorse double taxation, especially when the costs will be passed on to an already struggling population.” the statement noted.

Packaged water remains one of the most accessible and affordable sources of drinking water across the country especially for lower-income households. But the Association says the economic structure of the industry, particularly in sachet water production, makes it nearly impossible to immediately pass on the additional costs to consumers without creating major disruptions.

“As producers of sachet water, we cannot immediately pass on this tax to consumers due to the nature of our product. We urge the government to consider our request and prevent double taxation.” NASPAWAP explained.

Call for Dialogue, Not Disruption

With inflation pressures still lingering and cost-of-living concerns dominating public discourse, the timing of the new tax has sparked concern among operators and consumers alike. NASPAWAP is now appealing to the government to delay implementation of the 5% tax until the status of the previous 10% environmental levy is reviewed or scrapped entirely.

The Association also expressed its readiness to engage in constructive dialogue with the Ministry of Finance, the Ministry of Environment, and other stakeholders to find a more equitable and environmentally responsible solution.

“We are ready to engage with the government and relevant stakeholders to find a more balanced solution that aligns environmental sustainability with business viability,” the group said.

With water being a highly price-sensitive essential, any move that drives up its cost is bound to ripple across households, schools, markets, and street vending operations. Industry watchers say if government proceeds without modification, price hikes or production cutbacks could follow impacting employment and access to safe drinking water.

As Ghana balances revenue generation with sustainability goals in the second half of 2025, the packaged water industry’s plea could be the first of many voices challenging the method not the mission of new taxation.

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