Addis Ababa, Ethiopia – The Addis Ababa Revenues Bureau has announced that unprocessed vegetables, including onions and potatoes, are exempt from Value Added Tax (VAT). The move is aimed at easing the burden of daily expenses for the city’s residents.
In a circular issued to its branch offices, the Bureau clarified that “unprocessed agricultural products that the community purchases daily are exempt from Value Added Tax.” This directive is based on the Value Added Tax Proclamation 1341/2016, Article 10, and the subsequent implementation Regulation No. 570/2017.
The circular explicitly states, “It is stipulated that unprocessed products such as onions, potatoes, and other vegetables are exempt from Value Added Tax when imported or produced and supplied domestically.”
Consequently, the Bureau has instructed its staff to ensure that taxpayers who exclusively supply these unprocessed vegetables are not charging VAT. It also called for appropriate monitoring of the use of sales registration machines to enforce this exemption.
However, the Bureau emphasized that the VAT exemption does not extend to fruit products. Taxpayers dealing in fruits are to continue adhering to the existing VAT regulations, and the Bureau has urged for diligent follow-up to ensure compliance.
This clarification comes as a welcome relief to many households in Addis Ababa, as onions and potatoes are staple ingredients in Ethiopian cuisine. The exemption is expected to have a direct impact on the daily cost of living for a significant portion of the population.
