The House of People’s Representatives (HPR) of Ethiopia on Tuesday, December 1, 2015, held a discussion on a draft bill that look up income tax exemptions for cooperative societies, according to The Reporter.

The draft bill is an amendment to the existing Cooperative Societies Proclamation No. 147/1998 and its amendment proclamation of 402/2004.

The proposed bill under its section ‘government assistance’ gives a right to any cooperative society to be exempted from income tax. Nevertheless, members will be expected to pay tax on their dividends from the participation and on share.

The bill stipulates any primary cooperative society, established by persons who live or work in certain area as opposed to federal cooperatives, shall be established with in an initial capital that covers at least one year operation cost based on its plan and feasibility study.

Any cooperative societies union shall be established with an initial capital of at least 25 percent raised from members societies via special resolutions to execute plan developed for the federation based on feasibility study.

Any cooperative society shall conduct 30 percent of the profit and allocate for any reserve, the proposed provision on asset and fund of cooperatives specifies.

There are 67,000 cooperative societies currently in Ethiopia and 330 unions with a combined 12 million membership.

For further review, the draft bill was handed to Agriculture and Natural Resources Standing Committee.

Source: The Reporter