Commission says customs duty, tax laws not transparent

Ethiopian custom duty
Commission says customs duty, tax laws not transparent

By Hayal Alemayehu

The laws and regulations pertinent to customs duties and taxes levied on businesses were not transparent, thereby leaving room for malpractices and corruption offences at the Ethiopian Revenues and Customs Authority, the Federal Ethics and Anti-Corruption Commission’s (ERCA) latest report indicated.
The customs laws and binding regulations were not detailed enough and clearly stated, which made it difficult to put in place a clear-cut and transparent mechanism of tax assessment, according to the report presented to Parliament recently. “This will either expose or lead the tax assessment task to corruption offences.”

Accordingly, the commission has prepared and sent a report that will help the authority to update the existing duty and tax laws or regulations and minimize the existing loopholes that expose the tax regime to corruption offences and malpractices.

The commission drafted the report after consulting with the authority about the flaws of the existing tax and duty regulations, according to the report.

Aside from the tax laws and regulations, the commission indicated in its report that the way precious metals are kept in banks on behalf of the authority is exposed to malpractices and corruption offences. “The authority may seize various kind of precious metals smuggled in or out of the country or illegally transacted. However, theses items will be stored at banks without an expert distinctively indentifying them,” the report stated. “The absence of a strict control on the deposit and issue receipts also makes the task exposed to corruption acts.”