HARGEISA, Somaliland (Horn post) Ministry of Finance and Economic Development of the Republic of Somaliland has announced a major reform of the Goods and Services Tax (GST), including a 50% reduction in the tax rate and the expansion of digital tax collection through mobile money platforms.
Finance and Economic Development Minister Abdillahi Hassan Adan, accompanied by Minister of State Ismail Mawlid Abdillahi, Director General Mohamed Hassan Suleiman and Accountant General Hassan Muse Khalif, formally unveiled the tax reforms in Hargeisa on Sunday.
Under the new policy, the GST rate will be reduced from 5% to 2.5%, a move the government says is aimed at easing the financial burden on consumers and businesses while maintaining domestic revenue generation.
“This reform lowers the GST rate by 50%, from 5% to 2.5%, in order to reduce tax pressure on citizens and businesses while preserving the government’s ability to finance public services and national development projects,” the finance minister said.
The ministry also announced plans to modernize tax collection by integrating GST payments into digital financial services, including business mobile money accounts operated through ZAAD and eDahab platforms.
Officials said the new system is designed to broaden the tax base, improve compliance, reduce tax evasion and increase transparency in Somaliland’s financial management framework.
According to the ministry, the reforms will ensure that all taxable goods and services contribute fairly to national revenue, preventing the tax burden from falling disproportionately on a limited number of businesses or sectors.
The government said the modernization effort is part of a broader strategy to strengthen domestic revenue mobilization, expand the number of taxpayers and create a more equitable and efficient tax system.
The ministry noted that the new GST framework will be implemented after technical preparations and regulatory procedures are completed. Public awareness campaigns and guidance materials will also be rolled out to help businesses and taxpayers adapt to the new system.
Officials described the reforms as a significant step toward building a modern, transparent and fair tax regime capable of supporting Somaliland’s long-term economic growth and development objectives.
Prepared by:
Horn post staff
HARGEISA, Somaliland
