Ethiopia to Adopt ITAS Digital System to Boost Tax Revenues

ADDIS ABABA – Ethiopia has taken the first step to adopt the Integrated Tax Administration System (ITAS) to improve its domestic tax collection efficiency and transparency.

In the last 2021/12 Fiscal year, the government’s tax revenues increased by 20.59% to 336.710 billion Birr. Despite the growth, its GDP ratio leaves much to be desired, as per government officials.

The government, in its 10-year development plan, targets to achieve a tax-to-GDP ratio of 18.2% by the end of 2019/30.

As per experts, Ethiopia requires sustained reforms to increase the tax base and improve its tax administration to achieve the target.

The Ministry of Revenues (MoR) now plans to implement the ITAS digital system that automates end-to-end tax processes in the country.

MoF’s officials on Wednesday held the first meeting to launch the procurement of the ITAS solution with Crown Agents, a London-headquartered development firm managing the process,

In his opening remarks, State Minister of Revenues Tesfaye Tulu said implementing ITAS will modernize the tax administration and alleviate the challenges being observed in the sector.

It will also simplify the payment processes for taxpayers and enhance transparency in tax collection operations, making doing business easy for investors in Ethiopia, according to Tesfaye.

He also advised Crown Agents to carry out the procurement process in a manner that is transparent and beneficial to the nation.

Participants also urged for the procurement to include a data warehouse, Business Intelligence, and other infrastructures.

MoR carried out a Business process transformation study to modernize the country’s Tax management and, accordingly, decided to shift from the current SIG-TAX to the ITAS digital system.