Individual - Taxes on personal income

Last reviewed - 17 November 2023

In Ethiopia, individuals are taxed on income that is sourced from Ethiopia, wherever paid. An individual is either taxed as a resident or a non-resident.

Ethiopian resident individuals are taxed on their worldwide income. Non-residents are taxed on their Ethiopian-sourced income. The same rates of tax are applicable to both residents and non-residents.

The taxable income of a person for any year is the total of that person's income for the year less the total amount of deductions allowed to that person. Taxable income comprises the following: employment income, business profits, and investment income.

Summary of monthly employment income tax brackets


Salary (ETB*)  
Income tax payable (%)
Deductible fee** (ETB)
From To
0 600 Exempt threshold 0
601 1,650 10 60
1,651 3,200 15 142.50
3,201 5,250 20 302.50
5,251 7,800 25 565.00
7,801 10,900 30 955.00
Over 10,900   35 1,500.00

*  Ethiopian birr.

** The deductible fee is a tax relief applied to the Pay-As-You-Earn (PAYE) system, and the amount depends on the salary bands.