Senior Officials at Ministry Of Revenue are “frustrated” by the increasing level of contraband cases

By Sisay Sahlu

Ministry of Revenue said it has managed to collect over 83 billion birr taxes in the first five months of the 2018/19 Ethiopian fiscal year.

The amount is 19 billion birr short of its target – 102 billion birr – for the current fiscal year that started July 8, 2018.

SisayBahiru, planning director at the ministry, admitted the amount is off target but it is still “better achievement” when compared with first five months of last FY.

It has shown 6 billon birr surge when compared to similar period of the 2017/18 FY, the ministry’s report presented to members of parliament on Monday.

He said the achievement could even be bigger than this, if not for the various impeding factors which are affecting the ministry’s work.

Illegal business transactions triggered by both tax payer community and customers misunderstanding about VAT, contraband trade, unregistered business in combination with administrative incapability were among challenges that the ministry disclosed as impeding factors for not attaining its target.

This fiscal year, government plans to collect over 241 billon birr. But this effort could “hugely affected by the ever increasing contraband trade as well as inappropriate tax exemption directives”, saidDebeleKabita, Customs commissioner at the ministry.

He said the ministry is currently looking to find solution for both issues. 

‘Contraband trade Increasing’

According to Debele, the issues of contraband “is posing a very danger problem” to the ministry’s tax collecting endeavor.

Over 406 million worth of contraband products were captured in the first five months in various check points distributed across the country, the report said.

“Out of this, 100 million worth of products were seized at customs check point located at Addis Ababa Airport,” said Debele, likening the AA airport with “a forest without tree”. 

Items seized while coming into are reported to worth 329.5 million birr, and they are mainly apparels, electronics and narcotic drugs such as opium, according to the ministry’s report.

Many contrabandists were also arrested while trying to smuggle various foreign currencies worth 77 million birr, Khat, ornaments mainly through Ethiopian airlines. 

“The issue has become frustrating and needs a serious attention and solution,” Debele said. “In some cases, contrabandists have political backing.”

The director also revealed that movement of illegal armaments increasing, especially in Gambella, Eastern and northwest part of Ethiopia.

Government earlier last month announced that it will establish customs police to fight contraband trade. (Daily Monitor)