Tax Authority Kicks Off Pre-Trial Hearing on Alleged Duty Evader

Addis Fortune (Addis Ababa)

20 June 2011

Forto-Sawa — A case in a pre-trial hearing was filed by the Ethiopian Revenues and Customs Authority (ERCA) against Zelalem Adugna, the general manager of Zelalem Adugna Construction, on Thursday, June 16, 2011, for importing 20 vehicles without paying tax duties.

Zelalem, 29, is being investigated for masterminding the alleged offence that saw the import of type one and type two Toyota pickups as well as 4WD vehicles.

Zelalem, Matias Sahlu, and Yared Hailu conspired to forge documents and receipts granting individual contractors duty-free privileges by using their legal construction and investment permits, according to the investigation report.

Matias and Yared are wanted for allegedly facilitating the duty-free import of vehicles for the contractors.

The contractors are Tesfaye Yezengaw, Getachew Demisse, Eyob Yezengaw, Taha Mohammed, Ermias Hassen, Dagim Mergia, Daniel Tesfaye, Yosef Kassaye, Ephrem Equbai, Meron Aboye, Misrak Haile, and Henok Girma, according to the investigation team’s report.

The contractors were not eligible to use the duty-free privilege on more than two vehicles, the investigators claimed.

Zelalem has been in custody at the La Gare Detention Centre along with Biniyam Getachew, an employee of the ERCA, since May 27, 2011.

Biniyam, an employee in the authority’s accounting department, acted as an agent to facilitate the process at the ERCA for Dagim Mergia and admitted to the investigators to have received a cash payment of 2,000 Br, according to the pre-trial file.

Other employees in the ERCA’s duty-free import department who are suspected of being involved in the alleged crime are being investigated by the team led by Hailu Dirba, criminal investigation team coordinator of the ERCA.

The investigation was launched on May 17, 2011, after ERCA’s intelligence team received a tip from an employee at Zelalem Adugna Construction about the alleged abuse of duty-free privileges.

A new directive on the rewards of informants was issued by the ERCA in January 2011, setting the percentage paid to informants at 20pc of the total recovered by the authority. Previously, their compensation depended on the amount the ERCA recovered as a result of the tip Zelalem’s employee will be entitled to 20pc accordingly.

The Arada Giorgis First Instance Court had granted the investigators 10 days additional time on May 18 and another 11 days on May 27 to investigate the allegations.

Zelalem and Biniyam were first brought before the Federal High Court, Second Criminal Bench, on June 8, 2011, where investigators were granted an additional 14 days to finalise the investigation.

The vehicles were confiscated by the ERCA and impounded in its compound on Liberia Street.

Auditors of the ERCA are to calculate the loss sustained by the authority due to the alleged crime before the hearing commences on Tuesday, June 21, 2011.

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