Ethiopia: State Plans New Taxes to Strengthen Revenue Base
Somali State Revenue Bureau announced ambitions to expand tax revenue mechanisms as the national tax reform initiative enabled it to secure over 9 billion Birr from tax.
Speaking to the Ethiopian Press Agency (EPA) Bureau’s Deputy Head Ahmed Mohammed stated that the Bureau is endeavoring to enhance its tax collection capacity and a coordinated effort is being made to levy new taxes.
Accordingly, he mentioned that value added, property and turnover taxes are among options included in the list outlined to maximize the revenue. To realize the ambition, the Bureau is creating awareness and informing the business community, he added.
The Deputy Head also mentioned that the tax revenue collected in the state has increased following a national tax reform initiative and the state is expanding this experience as it paves the way for attracting new businesses.
“Before the tax-reform put in place throughout the State, the Bureau was collecting about 2-4 billion Ethiopian Birr, but now it is collecting over 9.1 billion Birr and the past six-month performance reached over 95 percent,” Ahmed said.
He underlined that, the revenue collected covers 43% of the State expenditure and the Bureau has ambition to expand its tax base to cover the whole State expenditure in the coming years.
The Bureau is well informed about the huge illegal trade operators that hampering the tax base and harming themselves and the nation, because they engaged in illegal business. The Bureau is trying to create awareness to the community using the media and engaging through face to face meetings, he indicated.
“We have been able to convince a huge number of illegal operators to follow the formal and legal system and pay tax voluntarily,” he said, adding that the Bureau is keen to apply value added, turn-over, and exit tax. Moreover, the bureau is operationalizing the latest technology that allows customers pay tax through mobile.
Ahmed underlined that the State is not collecting enough revenue compared to its resources because of a number of pushing factors.
One of the major challenges is the contraband trade as it is bordering Ethiopia with Kenya, Djibouti, and Somalia. Therefore, Ahmed’s Bureau is engaged in striving to overcome the problem by establishing a taskforce headed by senior leadership of the State and the Federal and regional police.
“We are planning to commence to levy property tax in the State revenue system, develop and apply well advanced software that could accommodate the demand of the tax payer’s demand. The Bureau is also planning to establish taxation centers in the urban and hinterlands in a bid to ease the hassle tax payers and collectors encounter,” he said.
He called on federal and development partners to further help the Bureau through technical, financial and technology support that enhance the tax base.
Crédito: Link de origem
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