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Ethiopian income tax rate table in a progressive tax system, meaning that the rate of taxation increases as the income of an individual or entity increases. Below is a simplified version of the income tax rate table for individuals in Ethiopia: 🇪🇹 Ethiopia Individual Income Tax Rates (2026) 1. Monthly Employment Income (PAYE) Monthly Income (ETB) Tax Rate 0 – 2,000 0 % 2,001 – 4,000 15 % 4,001 – 7,000 20 % 7,001 – 10,000 25 % 10,001 – 14,000 30 % Over 14,000 35 % Notes:• First Birr 2,000 monthly is tax-exempt.• Progressive system: only income in each bracket is taxed at that bracket’s rate. 2. Annual Rental Income (Individuals) Annual Rental Income (ETB) Tax Rate 0 – 24,000 0 % 24,001 – 48,000 15 % 48,001 – 84,000 20 % 84,001 – 120,000 25 % 120,001 – 168,000 30 % Over 168,000 35 % Notes: Applies to rental earnings from homes, apartments, and other property rentals by individuals. 3. Annual Business Income (Individuals) Annual Business Income (ETB) Tax Rate 0 – 24,000 0 % 24,001 – 48,000 15 % 48,001 – 84,000 20 % 84,001 – 120,000 25 % 120,001 – 168,000 30 % Over 168,000 35 % Notes: Applies to profit from business activities conducted by individuals (excluding Category B gross sales regime). 4. Category B (Gross Sales Tax) – Small Businesses For small individuals with annual gross sales under ETB 2,000,000, a gross sales tax is applied instead of normal profit tax: Annual Gross Sales (ETB) Tax Rate 0 – 100,000 2 % 100,001 – 500,000 3 % 500,001 – 1,000,000 5 % 1,000,001 – 1,500,000 7 % 1,500,001 – 2,000,000 9 % Note: This regime simplifies tax for small traders and micro-businesses. This table offers a clear understanding of how income tax is calculated in Ethiopia, enabling individuals to better manage their finances and plan for their tax obligations.

Category: Business

Ethiopian Income Tax Rate Table for 2026 Read Before Pay