Assuming the leadership of the newly restructured Minster of Revenue for about two months now, Adanech Abebbe appears to be steadfast in fighting tax evasion and fraud disrupting the overall economic system.
This week, Adanech launched yet again another initiative to recalibrate the Ethiopian tax system: a year-long national campaign aiming to create awareness about tax. Under the theme “Discharging Obligation and Demanding One’s Rights,” the campaign was officially launched by Prime Minister Abiy Ahmed (PhD) at the African Union Commission (AUC), on Friday.
The Premier made statements reciting concepts from the classical economist Adam Smith’s, The Wealth of Nations: “little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things,” Abiy quoted to highlight the need for financing the duties of the government for fair distribution, restoration of justice and running public offices along with triggering the economy.
For the current Ethiopian Fiscal Year, the target revenue to be collected from taxation is set at 213 billion birr. When The Reporter asked Adanech in a press conference she held on Wednesday at her office, whether the target revenues could be achieved in the middle of unsettled conflicts that come-and-go across the country since the new administration’s coming into power? The minister said and urged the public to be rest assured that the plans will certainly be achieved in time.
However, there are several pockets of deadly clashes happening everyday together with huge illicit outflow of local and hard currencies. Despite such events, the minister vows to construe well performing tax collection systems. During which time, many businesses cry foul and the economy is suffering a great deal owing to the ongoing instabilities.
According to Adanech, the existence of “shadow economy, mispricing, illicit outflows and contrabands have been identified as fertile grounds to financiers of ongoing conflicts in Ethiopia.
To swiftly address critical issues of the tax system, a new ministerial taskforce has been formed from the pool of ministries such as revenues, finance and National Bank of Ethiopia, to name a few. According to Adanech, congested containers at dry-ports have been released allowing importers to settle their due via bank promissory and pay the overdue later; since they have been challenged by critical shortages of finance, she said.
In the face of the high-pitched advertisements and nationwide campaigns to urge the public to pay their dues, the facts on the ground, as many see is the unease of normalized business environs in the country. Last year has seen a 50 billion deficit in tax revenues mostly due to the widespread unrests. (The Reporter)