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TaxID_FingerPrint

The Ethiopian government requires all taxpayers to register their businesses with the Ethiopian Custom and Revenue Authority (ECRA), submit a fingerprint, and obtain a Tax Identification Number (TIN). This process has been challenging for Ethiopians living abroad, but ECRA is transforming its operations and using a biometric system to streamline TIN issuance. Currently, fingerprint submission is mandatory for new business owners, while existing taxpayers have until June 30, 2011, to comply, with potential plans for ECRA staff to assist in the U.S.

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14 views2 pages

TaxID_FingerPrint

The Ethiopian government requires all taxpayers to register their businesses with the Ethiopian Custom and Revenue Authority (ECRA), submit a fingerprint, and obtain a Tax Identification Number (TIN). This process has been challenging for Ethiopians living abroad, but ECRA is transforming its operations and using a biometric system to streamline TIN issuance. Currently, fingerprint submission is mandatory for new business owners, while existing taxpayers have until June 30, 2011, to comply, with potential plans for ECRA staff to assist in the U.S.

Uploaded by

yonatan fikru
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Tax ID Number and Finger Print requirement

The Ethiopian government proclamation number 286/94 required all tax payers to register
their businesses with the Ethiopian Custom and Revenue Authority (ECRA) office, submit the
business owner’s finger print, and obtain a Tax Identification Number (TIN). For Ethiopians
living outside of Ethiopia obtaining accurate and timely information to comply with this
proclamation has been rather difficult. This is an attempt to clarify the requirement, the
timeline for compliance, and provide other relevant information.

ERCA operates in a society where the concept of paying a Value Added Tax (VAT) is new
and in environment where taxes were levied at the discretion of ECRA employees. This
situation has nurtured corruption and encouraged tax evasion.

To its credit, the ECRA office is one of the most transformed government offices in Ethiopia
and has been relatively successful in enforcing the tax law. ERCA is now actively using a
bio-metric based tax payer registry system known as Standard Integrated Government Tax
Administration System (SIGTAS) to register tax payers. SIGTAS generates a unique Tax
Identification Number (TIN) once a bio-metric data (right and left index finger print) of the
business owner is scanned in to the system. A TIN is akin to the nine digits Social Security
Number (SSN) the US government assigns to all its citizens.

What is a Tax ID Number (TIN)?

TIN is a single unique Federal level Tax ID Number (much like a US SSN or Employer ID
Number you see on your W2 forms) issued by the ERCA office in Ethiopia. Only one Tax ID
Number is required in Ethiopia regardless of the number or location of businesses owned
and operated.

Who needs to get a Tax ID Number?

The short answer is: every Ethiopian needs to get a TIN. More specifically, in the short run,
people who are earning a taxable income on a business or a rental property in Ethiopia need
to get a TIN and pay taxes.

If you don’t earn a taxable income in Ethiopia now but you are entertaining opening a
business or renting a real estate property in Ethiopia in the future, you are better off
submitting a finger print and getting a TIN at the earliest convenience.

Where does one get a Tax ID Number?

A TIN can be obtained by filling out a form and submitting a finger print at one of the many
ERCA branch offices located throughout the country.

What is the current finger print requirement status?

If you are an Ethiopian or Ethiopian origin living outside of Ethiopia and if you already earn
a taxable income in Ethiopia, meaning you are an owner of a business currently operating in
Ethiopia under your name, then you should already have some kind of TIN. The only thing
missing is scanning your finger print and attaching it to your existing TIN. The requirement
for you to submit your finger print has been waived until June 30, 2011.
If you are an Ethiopian or Ethiopian origin living outside of Ethiopia and you are in the
process of making a new investment to open a new business in Ethiopia, then you are
required to submit a finger print scan and get a TIN first. This has to be done as part of
getting your business license.

Do I have to travel to Ethiopia to submit a finger print?

As things stand now, the answer is yes. But ERCA understands the difficulty with such a
requirement and it is planning to send its own staff to USA (Washington DC and Los
Angeles) to help facilitate the finger print submission process. The staff tour is tentatively
planned to take place in April 2011. ERCA is also considering extending the staff tour to
other cities where a larger contingency of Ethiopian reside. Once schedules are finalized,
ERCA will make an announcement. But it is advisable to make a contingent plan a travel to
Ethiopia before June 30, 2011 in the event that the ERCA staff fails to travel to USA.

Are they ever going to make it easier to get a TIN?

ERCA is looking in to allowing tax payers get their own notarized finger prints and mail it in
to the nearest Ethiopian mission office. ERCA is working with SIGTA vendor to modify the
system so that it can scan a finger print from a hard copy. This may take a few months to
complete.

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