Business income tax calculator Ethiopia
Individuals who run a business and keep books pay business income tax on their taxable profit under Schedule C. Enter your taxable income for the year to see the tax.
Category B taxpayers are left out: they pay a tax on their annual gross sales instead.
How it's calculated
- The first ETB 24,000 of taxable business income a year pays nothing.
- Then 15% up to ETB 48,000, 20% up to ETB 84,000, 25% up to ETB 120,000 and 30% up to ETB 168,000.
- Income above ETB 168,000 pays 35%.
An example
A taxable profit of ETB 150,000 pays ETB 28,800 for the year.
Frequently asked questions
Who uses these bands?
Individuals with business income, except Category B taxpayers. Companies and other bodies are taxed differently.
Is there a minimum tax?
Yes. Proclamation 1395/2025 added a minimum alternative tax: if the tax on business profit comes to less than 2.5% of turnover, the taxpayer pays a minimum tax of 2.5% of turnover. An entity under liquidation and a corporate body under debt restructuring are exempt.
Since when do these bands apply?
For income derived from 8 July 2025.
Key terms
- Schedule C
- The part of the income tax law that covers business income.
- Category B taxpayer
- A small business that pays tax on its annual gross sales.
Up-to-date official data
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