ETHIOPIA – Ashraf Agricultural Industrial Complex Plc has lost a five million Birr tax appeal. Another appeal for 20 million Br is still pending at the tax authority and the appellate commission at the Ministry of Justice (MoJ).
Ashraf Agricultural Industrial is a member of the Ashraf Group – a Sudanese agro-industry business located in Bahir Dar, the capital of the Amhara Regional State.
The Ashraf group was established by Ashraf Seed Ahmed Al-Cardinal (PhD). The company made the appeal after the Ethiopian Revenue & Customs Authority (ERCA) conducted a tax audit and levied on it 25 million Br in July 2014.
Ashraf imported machinery using its duty free privilege, but illegally passed it over to another company, Bahir Dar Food & Edible Oil Manufacturing Company, which resulted in the five million Birr tax imposition, according to Ali Abdella, law enforcement director at the Bahir Dar Branch Office. The ERCA claimed an additional 20 million Br in unpaid withholding tax.
The Group, which was initiated in 2006 and inaugurated its investments in 2011, appealed to the branch office after 10 days of the tax imposition in the first week of July 2014, Ali said. Fortune’s attempts to get a comment from Ashraf were unsuccessful.
The branch office handled the appeal for the five million Birr tax, which it rejected two weeks ago, but the 20 million Br withholding tax claim, which Ali said was beyond the mandate of the branch office to review, was referred to the Tax Appellate Council at the MoJ, which has members both from the Ministry and the ERCA.
Ashraf, a company established with one billion Birr capital, has constructed buildings on two edible oil refineries in Bahir Dar, which have the capacity to produce 50tn of edible oil a day.
The company has two compounds in Bahir Dar, of which one is located on 37,000sqm of land that the company received from the Investment Bureau of the Amhara Regional State.
The other compound, which occupies 137,000sqm, was acquired through the Privatisation & Public Enterprises Supervision Agency (PPESA) in April, 2008, from Bahir Dar Edible Oil Share Holding Company, of which Ashraf is the major shareholder.
The Group’s businesses include edible oil production, farming, an export abattoir, meat processing, water and juice production, plastic factory and an animal feed factory. It supplies its products both to the local and international markets.