- Ethiopian Council of Ministers issued VAT Regulation No. 570-2025 in March 2025 for nonresident digital services providers.
- Significant aspects of the regime remain unclear, including the effective date and application of platform rules.
- VAT at 15% applies to remote services provided by sellers outside Ethiopia to recipients in Ethiopia.
- Nonresident providers may be liable for VAT on services performed in Ethiopia, immovable property services, inbound tourism products, agency or booking services, and telecommunications services used in Ethiopia.
- Regulation applies to foreign suppliers of electronically ordered goods, remote services, or electronic distribution platforms.
- Taxable electronic services include games, betting, internet bidding, digital content, mobile apps, subscription media, software, information management, music, search engines, online ticket sales, and other electronic supplies.
- Regime applies to B2C sales located in Ethiopia.
- A recipient is treated as a resident of Ethiopia if at least two criteria apply, such as billing address, bank account, fixed land line, mobile country code, IP address, or other relevant information.
- Electronic distribution platforms are liable for remote services they facilitate if they authorize charges or delivery.
Source: kpmg.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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