Ministry of Finance Issues New Directive on Social Development Tax Exemptions











The Ministry of Finance has recently introduced Directive No. 1023/2017, aimed at identifying goods exempt from the social development tax levied on imported items. This directive is designed to support key social sectors and provide relief for communities affected by both natural and man-made crises.

Purpose of the Directive

The directive outlines exemptions from social development tax on goods that contribute to expanding essential services, such as education and healthcare, which are offered free of charge to the public. Additionally, it aims to assist those impacted by disasters. Goods arriving as part of international aid are granted tax exemptions as they directly support social development efforts.

Which Goods Are Exempt?

The following categories of goods are exempt from the social development tax:

Aid for Social Service Institutions: Goods sent as foreign aid to the following social service institutions are exempt: A. Government-owned or public service institutions providing free services:Educational institutionsHealthcare facilitiesOrganizations supporting children, women, the elderly, people with mental illness, and those with disabilitiesB. Emergency Aid Organizations:



Goods sent as part of foreign aid to organizations providing emergency relief to communities affected by natural or man-made disasters

Educational institutionsHealthcare facilitiesOrganizations supporting children, women, the elderly, people with mental illness, and those with disabilities

Goods sent as part of foreign aid to organizations providing emergency relief to communities affected by natural or man-made disasters

Goods Exempt Under International Agreements: Items allowed entry without duties or taxes under international agreements signed by Ethiopia.

Defense and Security Imports: Defense and public security equipment, parts, and accessories imported by:



Ministry of National Defense







Federal and State Police Institutions







National Intelligence and Security Service







Information Network Security Administration

Ministry of National Defense

Federal and State Police Institutions

National Intelligence and Security Service

Information Network Security Administration

Currency and Precious Metals: Coins, currency notes, silver, and gold items imported by the National Bank of Ethiopia.

Goods That Are Not Exempt

Certain items cannot be imported without paying the social development tax. These include:

A. Automobiles with fewer than eight seats, including their accessoriesB. Single or double-cab pickup vehicles and their accessoriesC. Office supplies and equipment

Mandatory Documentation for Tax-Free Imports

To qualify for social development tax exemptions, importers must provide the following documents:

Aid Certification: Proof that the goods were acquired through foreign aid.

Invoice: A detailed invoice listing the goods and their prices.

Government Support Letter: A letter from the relevant government office confirming that the goods will be used for the specified purpose, with a commitment to report their use to the Ministry of Finance and the Customs Commission.