House of Peoples’ Representatives passed a new Value Added Tax (VAT) Proclamation during its 36th regular session.
Ato Desalegn Wedaje, Chair of the Standing Committee on Planning, Budget, and Finance, presented the proclamation alongside a report outlining its potential benefits. The report emphasized the proclamation's role in promoting savings and investment. VAT will apply to the consumption of goods and services, excluding capital goods used for production. This distinction incentivizes investment in machinery and equipment. The proclamation also incorporates recent advancements in Ethiopia's economy, particularly the rise of electronic transactions.
The HPR unanimously approved the VAT bill as Proclamation No. 1341/2024. In the same session, the house unanimously passed amendments to the export tax incentive system, designated as Proclamation No. 1342/2024. This amendment aims to support producers struggling to export due to a sluggish international market.
Source: Fana BC
