Tax Debt Relief Directive

Since the outbreak of COVID 19, the whole world is affected by it and Ethiopia is not an exception. Considering the effects of the epidemic the Ethiopian government made different actions to minimize the negative impact. One of the actions is the Proclamation of State of Emergency on April 8. Following this, a directive was issued, i.e. Tax Remittance Directive to Reduce the Impact of COVID 19 Epidemic on Tax Debt of Tax Payers No 64/2020 (the Directive). The Directive provided different ways and conditions to remit tax debt. Generally, it classified tax payers in two, these are Group A i.e. includes tax payers who completes their finance until 2007 following the Ethiopian budget annual year or 2014 of Gregorian calendar; and Group B i.e. includes tax payers who completes between 2008 and 2011 or between 2015 and 2018 of Gregorian Calendar as per to article 3 (a) (b).
When we see the scope of this Directive, it is applicable to different proclamation such as income tax, VAT, excise tax, turn over tax and tax administration tax debt until 2011 E.C or 2018 G.C; and also they should be in the business of construction, services, production, Import export and financial businesses. However, it will not be applicable on taxes that are collected by tax authority based on representation.
The Directive came into force from May 06/2020. Interested tax payers should submit their request to be entertained under the Directive within 30 days of the issuance of this Directive.
For further information and full article, please contact Yenatfanta Bekele yenatfa@dmethiolawyers.com

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