An independent committee set up during the summer have commenced investigation into ten Ethiopian Premier League players for possible tax fraud. Pan-Africa Football can exclusively report that four clubs including Mechal (Defense Force SC) are also implicated in the case. Five of the players currently play for Mechal.
The Ethiopian Premier League Share Company (EPLSC), together with law enforcement offices and the revenue authority, set up an independent body to look into rampant tax fraud in Ethiopian football. According to close sources who wish to stay anonymous, the independent body summoned ten players from four clubs after opening an investigation. The clubs are reigning league champions Commercial Bank of Ethiopia (CBE), Mechal, Diredawa Ketema and Sidama Coffee. All the clubs actively recruited players during the summer transfer window.
According to a new directive issued by the league, clubs can't spend more than 403,000 USD (50,000,000 Birr) on players salaries. Those who defied this new directive are subject to suspension.
The new directive put some clubs in a tight situation when signing players. Some clubs are said to be negotiating under the table so that they can add more money into the player's salary without the knowledge of the Ethiopian Football Federation (EFF) and the league share company. This meant authorities are losing millions in income tax since both the club and player don't reveal the exact amount of the salary. This method previously worked out for clubs but now the independent committee is helping the authorities crack down.
Back in October, league share company board chairman Lieutenant Fekade Mamo said an unnamed player signed for Mechal and received a lower salary after leaving Saint George. "One player who used to earn more than 380,000 ($2,970) birr net salary in Saint George left and signed for Mechal for 100,000 ($781) birr net salary. This is the issue that we are facing and we will not allow such moves to go unnoticed," said Mamo who is also the chairman of Ethiopian Coffee.
The players are expected to reveal why they received additional payment from the clubs without paying income tax. The committee is also expanding its operation to other suspected clubs.
Pan-Africa Football tried to get the names of the players but none have been named currently. The Ethiopian Premier League is among the highest paying top divisions in Africa. With the quality of the league continuing to decline, fans and stakeholders often complain over the unaudited public funds used in Ethiopian football.
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