Investigations conducted by the ERCA are inadequate, say participants

Nebeyou Samuel, deputy director of the ERCA; and Gebrewahad Wolde Giorgis, deputy director the ERCA's Law Enforcement Department; sit on the dias as they chair the meeting with taxpayers.

The Ethiopian Revenues and Customs Authority (ERCA) held its second meeting with taxpayers on August 31 and September 1, 2010, complete with kolo (roasted barley), water, and a lot of laughter, wherein the latter accused their host of inadequate investigations and compromising judicial independence by offering judges' training.

The two half day meetings took place in the National Lottery Hall with nearly 1,000 taxpayers from the East and West branches. There were no breaks and the participants munched kolo while expressing their views. The first meeting to discuss tax enforcement and implementation problems was held on August 4 and 5, 2010.

The authority was happy with over 90pc of taxpayers and only a few caused problems, Gebrewahad Wolde Giorgis, deputy director the ERCA's Law Enforcement Department, said.

Taxpayers were happy with 90pc of the ERCA's employees and there was a problem with only a few, countered a taxpayer, whose statement almost brought down the house with laughter.

Training is being given to members of the police force, judges, and public prosecutors, as part of the court reform initiated by the Ministry of Justice (MoJ), according to Gebrewahad, who chaired the meeting. The purpose is to fill their gap in knowledge of Ethiopian tax law, customs law, and value-added tax (VAT) law, he said.

So far, the authority has trained judges in Jijiga, Dire Dawa, Bahir Dar, Mekele, and Addis Abeba. It is set to continue until September 16, 2010.

The training was criticised by the tax payers, who said that judges would become biased in favour of the authority, which takes hundreds of cases to court annually. During the 2009/10 fiscal year, the ERCA filed 670 lawsuits and won rulings on 623.

"Our jop is only to train the judges as experts," Gebrewahad said.

The ERCA fails to collect the VAT receipts, claimed two taxpayer, one of whom said had served two years in prison for VAT evasion, he said.

The authority does not take tax evasion cases to cour for first time offenders; only repeat offenders cases, according to Gebrewahad. Some of its own employees are also serving up to 10 years in jail for tax-related corruption, he said.

"The authority has not filed a charge on any taxpayer who has committed only one offence' he said "Its aim is to educate, not to harm tax payers."

The ERCA plans to achieve development with tax payers who are active in business, not with tax payers who are serving time in jail, he told the meeting.

The inconvenience of using the mandatory cash register machines were raised by many of the participants. Having to report a power failure even if the machine continues to work with a generator and printing sale values of zero were some of the complaints raised.

Reporting power interruptions are not required if the machine continue working through a generator, but zero sale values must be printed, Girma Gebre Tsedike, deputy director of the ERCA's Corporate Department, said.

The tax authority's employees lack knowledge of the procedures, claimed many participants of the meeting. The problem was acknowledged by the authority, which plans to investigate and take measures against incompetent employees, Gebrewahad said.