Ethiopia has introduced new tax audits, conducting procedures, and the Assessment Directive No. 1063/2025, marking a significant development in its tax history. Tax audits represent a major challenge within the Ethiopian tax system; the implementation of tax audits contradicts the voluntary compliance expected from taxpayers under the self-declaration tax policy. During these audits, tax auditors often seek additional taxes without a legal foundation, aiming to meet monthly revenue collection targets. This trend significantly harms taxpayers, leading to non-compliance with tax laws and fostering illegal practices.
Tax Audits in Crisis: Can Ethiopia’s New Directive Restore Trust in the System?
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