Ethiopia

Ethiopia (officially known as Federal Democratic Republic Ethiopia) is one of Africa’s largest countries. Located in the Horn of Africa, Ethiopia borders Kenya in the south, Sudan in the west, and Djibouti in the east. Addis Ababa is the capital city, and the Port of Djibouti is its main seaport, as Ethiopia is a landlocked country. The official working language is Amharic, and the Ethiopian birr (ETB) is the official currency.

The Federal Government of Ethiopia is led by the Prime Minister, who appoints all the cabinet ministers (Council of Ministers). The Prime Minister is designated by the party that wins a majority of seats in the 547-seat lower House of People’s Representatives (HPR), which is elected for a five-year term. The HPR is the highest authority of the federal government. Ethiopia also has a House of Federation that consists of representatives from the nations, nationalities, and people of Ethiopia and whose main role is to interpret the law.

The 1994 Ethiopia constitution established nine member states of the federal democratic republic. Two more member states have since been established.

Ethiopia is the second most populous country in Africa with an estimated 117 million people in 2021, of which 40% are aged less than 15 years. The World Bank estimates the gross domestic product (GDP) per capita as 944 United States dollars (USD) (in 2021) with a GDP annual growth rate of 3% (2021). Foreign direct investment (net of inflows) constituted 2.2% of GDP (2020), with tax revenue as a percentage of GDP at 6.2% (2020).

Ethiopia is a member of the Common Market for Eastern and Southern Africa (COMESA) comprising 21 member countries and 586 million people, making it the largest market for trade and investment in Africa.

Ethiopia is also home to key international organisations such as the Africa Union (AU) and United Nations Economic Commission for Africa (UNECA).

PwC does not have a permanent office offering tax services in Ethiopia. However, PwC Kenya has a dedicated team responsible for providing consulting services relating to Ethiopia tax issues.

PwC has an extensive network of offices in most countries on the African continent. PwC Kenya provides integrated audit, tax, and advisory services across all industries. Our Tax Services division provides our clients with a broad range of tax services, including market entry (initial set up advisory), mergers and acquisitions, tax structuring advice, tax reviews, tax dispute support, corporate tax planning advisory and compliance, indirect taxes (VAT, customs, and excise) advisory, transfer pricing, personal tax advisory and compliance, reward and remuneration, and regulatory compliance and advisory services.