Proclamation No.1157/2019
A PROCLAMATION TO AMEND THE VALUE ADDED TAX
WHEREAS, it has become necessary to further amend
the Value Added Tax Proclamation No.285 /2002 (as amended);
NOW, THEREFORE, in accordance with article 55 (1) and (11) of the Constitution, it is hereby proclaimed as follows.
1. Short Title
This proclamation may be cited as the “Value Added
Tax (amendment) Proclamation No.1157/2019.”
2. Amendment
The Value Added Tax Proclamation No.285/2002 (as
amended) is hereby further amended as follows:
1/ Article 2 (1) is deleted and replaced by the
following new sub-article (1).
“1/ “Accounting period” shall means:
a) In the case of taxpayers whose turnover in any
12 months is birr 70,000,000 (birr seventy million) and over, every month;
b) In the case of taxpayers whose turnover in any
12 months is less than birr 70,000,000 (birr seventy million) every three
months, wherein the month of Nehasse and Pagumen shall be aggregated and
treated as one calendar month.”
2/ article 2 (4) is deleted and replaced by the
following new sub-article (4).
“4. “authority” means the Ministry of
Revenue.”
3/ new sub-article (27) is added following article
2 (26) of the Proclamation.
“27/ “capital good ” means an asset with a life
time of more than one year, used directly or indirectly in the manufacture of
goods and in the rendition of services and includes building, vehicle,
machinery, equipment, and other similar tangible assets .”
4/ article 7(5) is deleted and replaced by the
following new sub-article (5):
“5/ in the case of transactions to which
sub-article 1 (a) of this article is applicable.
a) the tax shall be withheld and paid to the
authority by the buyer in accordance with the directive to be issued by the
Minister of Finance;
b) the tax withheld in accordance with this
article shall be 50 percent of the tax payable by the buyer and the balance
shall be paid to the seller.
5/ Article 21 (6) is deleted and replaced by the
following new sub-article (6).
“6/ a) a person who registers or has to register
for vat shall be entitled to credit under this article in the first accounting
period in which the person is registered or has to register for vat, on the
amount paid on goods at hand on the date of registration and that are used or
to be used for the taxable transaction, but only to the extent that the
purchase or import of the goods occurred not more than six months before the
date of registration.
b) a person whose 12 months taxable
transaction exceeds birr 100,000,000 (birr 0ne hundred million) shall be
entitled to credit under this article in the accounting period after the date
of registration on the amount of value added tax paid on capital goods at hand
or purchased after the date of registration that is used or to be used for
taxable transaction.
6/ the following new sub-articles (7) and (8) are
added following article 27 (6).
“7/ notwithstanding the provision of article
21 (6) (b) of this proclamation, the authority
shall refund the remaining amount of vat paid on capital goods in excess of the
amount credited in the accounting period within the coming one month.
8/ the authority shall implement risk based refund
system for refund to be paid in accordance with this article.”
3. Effective Date
This proclamation shall enter into force on the date
of its publication on the negarit gazette.
Done at
addis ababa this 13th day of August, 2019
SAHLEWORK ZEWDIE
PRESIDENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA
No comments:
Post a Comment