Section 7 (1) (k) of the ACT 896 states, a COLA is an exempt income for income tax purposes when a COLA, other than a training allowance paid in place of a salary for services rendered abroad by members of the Ministry of foreign affairs and officers attached to official Ghanaians diplomatic missions or consulars abroad.  The only group of persons that their COLA cannot be taxed are the people working with the ministry of foreign affairs and other diplomatic missions outside Ghana. Even with that the COLA should not include training allowances which was paid to people as a form of payment of their salary. In simple terms if you are not working for Ministry of foreign affairs or any diplomatic missions outside Ghana, any COLA you receive is taxable.