: Proclamation No. 979/2016, Proclamation No. 1395/2025, Regulation No. 410/2017, and Directive No. 2/2018.
Comprehensive Guide to the Withholding Tax Proclamation in Ethiopia: Best Practices and Resources withholding tax proclamation in ethiopia pdf best
: The withholding agent must remit the total collected tax to the Ministry of Revenues within 30 days following the end of the month in which the payment occurred. : Proclamation No
The 2025 reforms have updated withholding tax rates for various income categories. All payments must comply with the new rates effective August 7, 2025, unless otherwise noted. 410/2017, and Directive No
The Ethiopian tax landscape has recently undergone a seismic shift with the enactment of the , which significantly revises the foundational Federal Income Tax Proclamation No. 979/2016 . This legislative evolution reflects Ethiopia's broader strategy to modernize revenue collection, broaden the tax base, and capture the growing digital economy. Core Amendments to Domestic Withholding Rates
: Withholding agents (including state organs, non-profits, and bodies with legal personality) must withhold 3% of the gross payment on transactions exceeding the statutory threshold, excluding micro-enterprises. 2. Broadened Digital Economy Capture
: All federal and regional state organs, public enterprises, and ministries.