ADDIS ABABA –The Ministry of Revenue disclosed that the country’s tax revenue is increasing from time to time. Fikadu Tadesse, Strategic Planning and Administration Director at the Ministry told The Ethiopian Herald that following the tax reform and restructuring of tax authorities, the country is generating more tax than before, though the tax to GDP ratio still remains low.
The overall reform at the national level has also affected the tax collection system and performance; he said adding “We have undergone a historic reform.” The mechanisms the Ministry has put in place to improve tax revenue include establishing Tax Fairness and Cooperation Office and organizing national tax campaign, he said.
As to him, contraband has been one of the major challenges of the country’s tax collection system. Following the reform, it has been managed to seize contraband goods worth of 1.3 billion Birr. The Ministry has put in place various controlling mechanisms that aim at increasing tax revenue, halting contraband, preventing inflation and ensuring fair distribution of income.
Moreover, lack of technological support, absence of registration of revenue and weakness of tax administration and awareness are the main influencing factors to generate low enhanced tax revenue, but the recent national tax awareness campaign has been contributing its role to national tax income increment, he added.
Stating that the recent national tax awareness campaign has contributed its part to the improvement, it is vital to introduce and implement an e-tax and fair tax collection system to further improve tax income generation and change tax collection system he said.
According to a study by the UN Development Program about Performance and Prospects of Tax Collection in Ethiopia, the country’s tax revenue has increased from Birr 12.4 billion in 2005 to Birr 165.3 billion in 2015 indicating over thirteen fold increases in the decade. The Ministry recently disclosed that it has collected 145 billion Birr over nine months this fiscal year.
The Ethiopian Herald April 25/2019
BY TSEGAYE TILAHUN
