Customs Authority Almost Achieves to 100pc in First Half Year

The first half of the current fiscal year has shown success for the Ethiopian Revenue & Customs Authority (ERCA) in regards to revenue collection at the Federal level, surpassing its target by 1.5 billion Br, but it has failed by 25pc from its target in Addis Abeba.

During the last six months, the Authority collected 64.6 billion Br revenue, which is 97.8pc of its plan. In the same period of the last fiscal year of 2013/14, ERCA reported 53.3 billion Br from its plan of collecting 60.6 billion Br and 43.7 billion Br during the first half of the 2012/13 fiscal year.

The Authority is aiming to collect 134 billion Br this fiscal year; last year it targeted 126 billion Br, but managed to collect 106 billion Br. These figures are all way higher than the 19 billion Br that was collected in 2008, when the Authority was established with Melaku Fenta as its director. It was created by the merger of the Ministry of Revenue, the Ethiopian Customs Authority and the Federal Inland Revenues Authority.

The largest revenue of this, representing more than half, came from domestic taxes, an area where the authority hopes to obtain 72.8 billion Br by the end of the fiscal year. Customs duties collected from imports accounted for 43.3pc, with 28 billion Br collected, while the National Lottery Administration (NLA), the only raffle business in the country, has contributed 63.48 million Br, representing a share of 0.1pc.

From the total of 64.6 billion Br, Addis Abeba contributed only 9.1 billion Br, down from the target 12.3 billion Br for the first half of the current fiscal year. From the 13,558 businesspeople, only 6,352 of them reported profit while 5,430 of them reported loss and 1,001 reported zero sale, according to Ephrem Mekonen, Communication & Promotion director of the Authority.

“The revenue collected from Addis Abeba is below the target, which is mainly caused by over half of the businesses reporting zero sale and losses,” said Ephrem. “We will conduct an investigation and tax audit for those who reported zero sale and losses.”

Revenue collection form ERCA has a 12.6pc contribution to gross domestic product (GDP), far lower than the 18pc average for sub-Saharan Africa. The country planned to push the contribution to 15pc by the end of the current fiscal year, which is also the end of its five-year Growth & Transformation Plan (GTP).

At a press briefing held on Tuesday, January 27, 2014, at ERCA headquarters, off Equatorial Guinea Street, in Megenagna area, Ephrem stated the current fiscal year was also successful in reviewing and solving claims from the business community.

“From the 1,870 claims we received in the last six months, we reviewed and gave solution for 1,849 claims,” he said.

The Authority also reported losing 904 employees during the half-year period; 28 of them were fired because of engagement in corrupt practices and other disciplinary issues, Ephrem said.

The Authority stopped and confiscated livestock, khat, coffee, gold, silver, cereals, vegetables and fruits that were about to be smuggled out, as well as garments, electronics, foods, cigarettes, cosmetics and drugs, which were inbound. These incoming and outgoing goods, all confiscated, brought the Authority a total of 200 million Br, according to the report.

Beker Shale took over as ERCA’s second director on May 29, 2013, replacing Melaku Fenta, who has been in custody and on trial on corruption charges. Revenues collected by the Authority, always growing, have increased from 49.1 billion Br in 2011/12 to 82 billion Br and 106 billion Br, over the following two consecutive years.






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