The Addis Ababa Revenue Bureau has announced plans to intensify warehouse and vehicle inspections as part of a crackdown on suspected tax evasion involving car importers and commission based vehicle dealers in the capital.
The bureau said it has identified vehicle storage warehouses across Addis Ababa and gathered information on the vehicles stored at the facilities.
The latest inspection campaign follows measures taken against commission agents operating car dealerships without vehicle import licenses. The bureau said it suspended the business licenses of such operators and ordered them to return vehicles being offered for sale to the original importers.
According to the bureau, the practice has resulted in significant losses in tax revenue and created unfair competition for licensed importers that sell imported vehicles through their own dealerships.
Despite the recent enforcement measures, authorities said some vehicles have been moved to warehouses and other locations in an attempt to avoid inspection.
Mohamed Abdurehman, Deputy Head of the Law Compliance Sector at the Addis Ababa Revenue Bureau, said a city level task force will continue warehouse inspections, door to door checks and vehicle inspections to identify such cases.
The bureau also raised concerns about the methods allegedly being used to understate vehicle sales and reduce tax liabilities.
Mohamed said some commission agents issue invoices showing prices below the actual selling value of vehicles and receive the remaining payments through different bank accounts.
He said the practice makes it difficult for tax authorities to establish the actual transaction value because vehicle ownership transfers are processed based on the amount stated on the sales invoice.
The bureau has called on vehicle importers and dealers operating outside the legal framework to regularize their activities voluntarily.
Mohamed warned that authorities would take legal action where vehicles linked to violations are identified during inspections.
Source: Sheger FM 102.1
