VAT Overhaul Targets Broader Revenue Base


VAT Overhaul Targets Broader Revenue Base

The VAT-exempt items have been reduced following a directive signed by Finance Minister Ahmed Shide last week. The revised list now includes cereals, agricultural inputs, and capital goods. Notably, animal feed, edible oil, travel agent services, prints for publication, import of fuel gas, and pension funds are now included in the taxable base.

The forthcoming tax proclamation, currently under parliamentary review, aims to broaden the VAT tax base to encompass various services by the next fiscal year. In 2022, VAT constituted approximately 21pc of annual tax revenues, amounting to nearly 336 billion Br. Of this, 58pc was derived from domestic taxes, with the remainder sourced from customs revenue.

With a target of achieving an 18.2pc tax-to-GDP ratio within four years, this pending legislation represents a pivotal tool for revenue mobilisation in the developing world, where tax-to-GDP ratios typically hover around seven percent.


Radar

Abyssinia Bank Strategic Moves Pay Off, Driving Profit Growth

The Bank of Abyssinia (BoA) enjoyed another profitable year, amassing 4.23 billion Br net profits, an increase of 10.5pc from last year. The Bank announced total assets of 222.3 billion Br, surging by 17.3pc. Total deposits mobilised through the year climbed by 33.97 billion Br to 192.51 billion Br, while loans and advances reached 167.7 billion Br. However, the bank exhibited a nominal decline in its foreign currency earnings totalling 424 million dollars. Earnings per share also showed a ma...


Radar

$100m Project Mulls Public Transportation Make-Over

A 100-million-dollar project aims to manufacture over 5,000 diesel-powered and electric public transport vehicles for the capital. The proposed project was launched hoping to replace the ageing vehicles and improve safety, efficiency and quality across the city's urban transport system. Last week saw an MoU inked between executives of Multiverse Enterprise Plc and Addis Abeba Minibus Associations and was held at Vamdas Entertainment near Megenagna. The agreement includes plans to replace 15,000...


Radar

Safaricom Soars with 6.1 million Customers

Safaricom Ethiopia reported significant commercial growth in the first six months of the 2025 fiscal year (April to September 2024), with notable increases in both mobile (GSM) and M-PESA services. The company's network and services reached a population coverage of 46pc, growing from 30pc in the previous year. This expansion was supported by the addition of over 1,000 network sites, bringing the total to more than 3,000 across the country. Safaricom Ethiopia saw a surge in its customer base,...


Back
WhatsApp
Telegram
Email