Online Tax Filing on the Horizon for Middle Taxpayers

Tax authority launched training for impending inclusion in e-file system

The Ethiopian Revenues & Customs Authority (ERCA) has started training middle-income taxpayers on its e-file system as of October 14, 2013, so that they can start declaring their taxes online.

The system, which cost 90,000 dollars, was financed by the Investment Climate Facilitation for Africa (ICF) – a programme to provide financing to developing countries for environmentally friendly growth – which agreed to finance the project due to its paperless nature- with partial help from ERCA , according to Ephrem Mekonnen, director of Education & Communications at the ERCA.

CRC Sogema, a Canada-based consulting firm, installed the system back in 2009.

“The service first started as a pilot project by the Authority in 2010,” said Fekadu Tadesse, customer service coordinator at the Large Tax Payers Office at ERCA. “Customers can inform us of their taxes via the Internet and we then send them a printout with a code, through which they can come to the office and pay.”

At the moment, only large taxpayers – those with turnover over 27 million Br annually – are using the e-filing system. After the current training has been completed, however, the Authority will extend the service to medium tax payers. ERCA decided to expand the service to include them after being encouraged by successes in its first attempt, according to Fekadu.

E-file is under the e-tax project of ERCA, which seeks to automate all tax filing in the country by allowing taxpayers to declare their taxes remotely through Under the e-file, although taxpayers file online, their payments can only be accepted at an ERCA office.

E-tax, however, will eventually include e-payment, which will let taxpayers pay taxes through any bank, after filing documents online, said Getachew Tadesse, customer service process coordinator at the Western Branch of Middle Tax Payers Office.

“A tax payer can now declare any type of tax they want online,” he said. “Customers will have a username and password through which they can log into the website.”

The e-payment will be implemented as soon as the systems have been put in place and the Authority signs the necessary deals with all banks. In addition, ERCA plans to introduce refunding and clearance systems after seeing how well e-file and e-payment work, according to Getachew.

The training launched last week will be given to participants from the 16,000 middle taxpayer institutions, who can then train other employees at their respective companies. The training, which takes two days to complete and is given free of charge, will host 20 to 30 trainees in each session.

Only after all 16,000 have been trained will the system be opened to middle taxpayers. Though ERCA has not determined how long it will take to do so, it expects to train up to 4,000 people this fiscal year alone.

This is not without challenges, however, as ERCA expects to face fluctuating attendance levels, the qualifications of trainees and the recurring Internet network problem plaguing the country.

“Some of our clients did not show up during last week’s training,” Getachew said. “Some of them sent employees who are not versed in finance.”

However, there is little ERCA can do, according to him. “We can only advise taxpayers to take this training seriously because, in the future, all taxing will be done electronically.”

On the network problem, Getachew advises taxpayers to opt for EVDO connection as it is more reliable in accessing the Internet.

The switch towards electronic documentation is not limited to ERCA. The Ministry of Communications & Information Technology (MoCIT) has contracted Africom Technologies Plc and e-Systems Africa to build over 200 e-service portals, through which government offices can public services electronically.

E-file, however, is separate from MoCIT’s project, according to Ephrem, since ERCA had already signed a contract with CRC Sogema by the time the MoCIT project started.

In fact, CRC had already delivered the website to ERCA by the time the Ministry awarded the contract to Africom and eSystems, he explains. But a link to ERCA’s website will be put on, where MoCIT’s project is found, as soon as e-tax is fully operational.

In 2006, CRC Sogema had developed Standardized Integrated Government Tax Administration System (SIGTAS) for the Authority to be connected to regional revenue bureaus.

The ERCA plans to introduce the training in the curriculum for finance students in colleges, Fortune learnt.


Published on October 27, 2013 [ Vol 14 ,No 704]



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