Monday, May 20, 2024
BusinessMinistry collects record revenue in a month

Ministry collects record revenue in a month

The Ministry of Revenues announced that its tax payment campaigns has resulted in the hike of its revenue collection for the month of February as it collected 17.8 billion birr, a record monthly collection its history. This performance is 90 percent of the planned 19.9 billion birr targeted for the month. There has not been a collection made more than 15 billion birr on a monthly basis, so far.

Speaking to a group of journalists, the Minister of Revenues, Adanech Abebe, said that, for the past eight months of the Fiscal Year (FY), her Ministry has collected 130.7 billion birr out of its planned 161.8 billion birr, achieving 81 percent of the plan. This showed an increase of 11.6 percent when compared to the previous FY.

The Ministry planned to collect 137.1 billion birr from internal revenues for the FY 2018/19 while it collected 80 billion birr within the past eight months. The plan for the eight months was to collect 91.5 billion birr.

When it comes to customs collection performance, Adanech said that 104.4 billion birr was planned for the FY. The eight months brought in 50.6 billion birr from the planned 70.1 billion birr.

“Collection of overdue payments, quick grievance redressal, enhanced law enforcement efforts, fiscal activities, tax payment campaigns and the reforms within the Ministry played huge roles in this performance,” Adanech added.

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But, the performance of VAT and withholding collections is dwindling. For instance, the Ministry planned to collect four billion birr from these areas of indirect tax while it collected only 1.6 billion birr.

Adanech also lamented that some businesses are not operating under the legal frameworks and the informal economy is rampant.

“The individual taxpayers are better off than institutional taxpayers when it comes to respecting the law and paying taxes,” she stressed.

While only 60 percent of the total potential taxpayers are in the tax system, the other 40 percent circumnavigate the system in different methods, Adanech explained. She added that, even those within the tax system are not paying what they have to and the tax collection is not up to par with the economic growth.

The expansion of contraband trade is also another threat for tax collection, even though the Ministry has confiscated goods worth of 199 million birr in the month of February alone. Hence, in light of curbing contraband, the Ministry has added 24 more checkpoints which used to be open.

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