ADDIS ABABA – The Ministry of Finance decided to exempt tax and tariff levied on some basic food commodities in an effort to control inflation and stabilize the market in Ethiopia.
State Minister of Finance Eyob Tekalegn told reporters on Friday the decision was made in an effort to control the increasing inflation and stabilize the market.
The commodities on which tax and tariff are fully exempted are wheat, edible oil, sugar and rice.
Value added tax on egg, spaghetti and Macaroni have also been exempted, according to the ministry.
Citing a study, the state minister said the government will lose billions of Birr due to the decision to be implemented for an unspecified duration.
The ministry has recently been taking monetary, fiscal and structural measures to increase the purchasing power of the people.
The government is committed to continue to take similar measures when deemed necessary, Eyob said.
To sustainably control the rising inflation, the minister said the government will work on improving productivity, especially in the agriculture sector, increasing supply, checking the market system and fiscal policy decisions.
Apart from purchasing and distributing consumer goods such as wheat and edible oil, the government has extended the Franco-Valuta License permit to import basic goods without foreign currency for the next six months.