Officials at the Ministry of Revenues have issued a directive requiring all tax invoices to feature unique quick response (QR) codes in a bid to enhance tax compliance and transparency.
The amended tax invoice usage and administration directive mandates taxpayers to utilize differing invoices for each business category that applies to them, as well as for each business location, and include a unique QR code on the invoice.
Tax officials will not accept invoices that do not include this code, according to the directive inked by Aynalem Nigusie, minister of Revenue.
Starting immediately, all printing enterprises are required to include a unique QR code, provided by the tax authority, on every printed tax invoice. Officials hope the new rules will enhance tax compliance and streamline the verification process for tax authorities by ensuring the accurate tracking and reporting of transactions.
All businesses are mandated to print a unique QR code on the right header of their tax invoices. The QR code must have a minimum width and height of two centimeters.
Revenues officials mandate printing press enterprises to obtain a letter of permission from the relevant tax authority before printing tax invoices for any taxpayer.
The amended directive requires taxpayers who printed tax invoices prior to the directive’s implementation to utilize them within three months from the effective date.
Ethiopia has registered considerable progress in tax collection over the last two decades, with revenues rising from 12.4 billion birr in 2005 to 165.3 billion birr in 2015 and over half a trillion birr by the end of the 2023/24 fiscal year.
However, the growth of the country’s economic output has outstripped its tax collection over the same period. The tax-to-GDP ratio was estimated to be 13.4 percent in 2015. By the end of the previous fiscal year, the figure had dropped to seven percent.
Tax officials have cited a lack of crucial policies, administrative inefficiency, slow technology adoption, and a flourishing contraband trade for the languishing revenue figures.
The problem was raised during the Prime Minister’s address to Parliament last month, where he attributed ailing tax collection to the prevalence of an informal economy.
“We do not collect taxes,” said the PM.
