Ethiopia MOF Issues VAT Proclamation on Cross-Border Taxation of Digital Services for Nonresident Providers

The Ethiopian Ministry of Finance Sept. 2, 2024, issued VAT Proclamation No. 1341/2024, on the cross-border taxation of digital services supplied by nonresidents. The proclamation includes measures to: 1) apply a 15 percent VAT rate to remote supplies of services to residents by businesses located outside Ethiopia; 2) impose VAT liability on nonresident providers without a permanent establishment (PE) in Ethiopia for services physically performed in Ethiopia and other specified services; 3) specify the criteria for treating recipients of remote services as Ethiopian residents, and for determining VAT liability for remote services provided by electronic distribution platforms; 4) require VAT ...