Ethiopia deploys cameras in breweries, bottling plants to curb tax evasion

ETHIOPIA – Ethiopia’s Ministry of Revenues has begun installing mandatory surveillance cameras in breweries and bottling plants with a 300 million birr (US$5.2 million) budget to close the reporting gap and curb excise tax evasion on alcoholic beverages, soft drinks and tobacco products. 

The rollout, which follows Implementation Directive No. 1079/2025, requires manufacturers of excisable goods to install cameras at their own expense. 

The strategic monitoring devices target production lines, packaging areas and warehouses where finished goods are loaded for distribution. 

The cameras provide real-time, remote tracking of production processes, facility exit points and freight transport, giving the Ministry unhindered digital oversight directly on the factory floor. 

How the Digital Monitoring System Closes the Reporting Gap

For years, tax authorities have grappled with the “reporting gap” the discrepancy between a factory’s actual production and its declared output for tax purposes. 

A senior factory manager, speaking on condition of anonymity, stated that the installation was never formally communicated beforehand, with factories told directly at a Ministry meeting that the equipment would be installed. 

Under revised Directive No. 1007/2024, malt beer is now taxed at 40 percent or 28 birr (US$0.49) per liter, whichever is higher, a sharp increase from the previous flat rate of 11 birr (US$0.19) per liter. 

Cigarettes are now subject to a 30 percent tax plus a specific excise of 20 birr (US$0.35) per pack, up from 8 birr (US$0.14) per pack.

Broader Economic Reforms and Tax-to-GDP Targets

The camera rollout is part of Ethiopia’s National Medium-Term Revenue Strategy, which aims to reverse the country’s declining tax-to-GDP ratio from 8.5 percent in 2021/22. 

The International Monetary Fund anticipates the comprehensive digital track-and-trace system will be fully operational by December 2026. 

In the 2025/26 fiscal year, the Ministry collected 1.518 trillion birr (US$26.4 billion), exceeding its revised target, with domestic taxes accounting for 774 billion birr (US$13.5 billion) and customs duties contributing 725.3 billion birr (US$12.6 billion). 

The Ministry of Finance projects total excise tax revenue for 2026/27 at 48.8 billion birr (US$849 million).

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