Draft Excise Tax Proclamation Reduces Prices of Basic Goods, Encourages Domestic Production: State Minister

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Ena January 17/2020 The recently revised draft excise tax proclamation encourages domestic production and fair price on basic commodities, Finance State Minister Eyob Tekalign said today. 

Though serious consultations were undertaken with stakeholders to create awareness and gather inputs for the draft excise tax law referred to the parliament, there are still confusions about issues with regard to the excise tax imposed on basic goods, vehicles, soft drinks, and products harmful to health, according to the state minster.

Thus the ministry has agreed with the House of People’s Representatives yesterday to continue public relations work and awareness creation.

The main concern of the public is the effect on price increase of basic commodities such as sugar, salt and edible oil, Eyob pointed out.

He, however, argued that “no new excise tax is added on sugar, edible oil and salt.”

“Excise tax on sugar which was 33 percent at manufacture is now, for instance, reduced to 20 percent at sales. So, the excise tax law encourages the domestic sugar industry to produce more,” Eyob added.

Excise tax on salt is also reduced and no change is made on edible oil.

The state minister further stated that domestic car producers will benefit by about 63 percent tax reduction from the existing taxation law of the country.