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Displeased with the additional tax levied on meat and the decline by butcheries to buy oxen from informal traders, Addis Ababa is thrown into an abrupt meat shortage since last week.
A number of butcheries closed their shops since the increment was made and dwellers were unable to get meat in nearby shops. Long lines of people, ones similar to the lines observed at taxi and bus stops at rush hours, were seen in front of some butcheries on Sunday July 19, morning when a seasonal fasting period ended.
The Addis Ababa Abattoirs Enterprise that regularly slaughters between 700 and 800 oxen per day slaughtered 450 oxen in the past week as demand was thwarting.
Starting from the 2014/15 budget year, the Ethiopian Revenue and Custom Authority (ERCA) has levied a profit tax of 10 up to 35 percent on butcheries depending on their size – higher, middle and low. Before the budget year begun, ERCA used to calculate profit tax by assuming the price of an ox at 1,000 birr. However, the new system which came into action one year before requires butchers to present a voucher that shows for how much the live ox is bought from farmers or formal cattle sellers.
The Addis Ababa Butchery Owners Association, which is unhappy with the additional tax, said the situation is induced by some selfish butchers who do not comply with the legal procedure.
The association said it has written a letter to the Prime Minister’s office and to the Ethiopian Institution of the Ombudsman demanding a reconsideration of the tax. A butcher on conditions of anonymity told Capital that the government should review the profit tax and the value added tax levied on meat.
“Meat is one of the most popular foods in Ethiopian culture and it is not fair to levy 35 percent tax on it. In addition to that, the value-added tax will drive away customers.”
“I believe that receipts should be issued to all transactions. Illegal sales should not be tolerated because it is a nascence to the cattle market,’’ he added.
Atakelti Gebre Eegzahbir, Director of Supportive Services with Addis Ababa Revenue and Custom Bureau, said the tax revision was made in relation with the current price of cattle.
“Now the price of an ox is 10,000 birr the lowest and 30,000 birr at the highest. A kilo of meat is sold from 100 birr up to 300 birr a kilo and the price of a dish that is made from meat also increased. Based on that, we calculate the tax.”
Atakelti said that the value added tax is applied on dishes that are prepared from meat, but not on the transaction of oxen. There are around 1,500 butcheries in Addis Ababa. The city consumes 30 percent of the total meat supply of the country.