Melaku Fenta and Gebrewahid W.Giorgis
Melaku Fenta, Former director of Ethiopian Revenues & Customs Authority (ERCA);
Gebrewahid W.Giorgis,Former deputy director of ERCA.
In what could be taken as one the high-level corruption investigations in the country in a decade, Melaku Fenta, former director of the Ethiopian Revenues & Customs Authority (ERCA), and Gebrewahid W. Giorgis, deputy director of ERCA, were detained by the federal corruption watchdog, for allegedly getting involved in corrupt practices that devoid the state of a huge sum of revenue in the form of tax. The two individuals who used to be taken the movers and shakers of the tax reform efforts the nation is witnessing joined the spotlight with their unexpected detainment. Their detention came along with the imprisonment of renowned businesspeople and lower lever customs officials who were said to have been involved in a complex chain of corruption. The imprisonment of the officials was all but unforeseen. The total number of people detained has once reached 64.
When It Happened:
The officials were detained on May 10, 2013. However, the wave of arrest continued even months since then.
What to Know:
Melaku Fenta is originally from Amhara Region, While Gebrewahid is from Tigray Region. Melaku is educated in economics and business administration. He also has a Master’s Degree in Customs & Revenues and Diploma in Public Management and Urban Governance. Gebrewahid is also said to have a Master’s Degree in customs related field. He is said to have studied in bothUKand US. Malaku’s service in the public sector started with the Ministry of Labour & Social Affairs (MoLSA). He was, then, moved to the regional affairs department of the Prime Minister’s Office. He served as Minister of Revenue for three years starting from 2005 and head of ERCA from 2008 till his detainment. Gebrewahid is also said to have huge experience in customs and revenues, with specialisation in law enforcement.
Total tax and non-tax revenues collected by the government in 2011/12, under Melaku and Gebrewahid, reached 70.75 billionBr.This was significant leap from the previous year, which saw total revenues of 54.17 billionBr. Both figures were beyond the plans set by the federal government. During the very fiscal year its officials were detained, the ERCA planned to collect 101 billion Br in revenues.
The imprisonment of the two taxmen along with renowned businesspeople and lower-level officials is said to relate to allowing goods to pass through customs uninspected, tax evasion through graft, import of cement using the prohibited Franco Valuta method and selling duty-free imports meant for investment.
In his tenure as director of ERCA, Melaku is considered to be a humble official with essential civility to understand the concerns of businesspeople. In contrast, Gebrewahid is perceived as an aggressive official. Both were feared within the business circle, however. They were considered to even be the ‘untouchables” of the system. That seems to be why their detainment was received by the public with mixed feelings.
Under the leadership of Melaku, the ERCA has managed to improve the tax collection system of the nation. Tax revenue as percentage of gross domestic product (GDP) has reached 11pc. Even if it still is less than the Sub-Saharan average of 13pc, the improvement has been recognised even by international financial institutions.