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Somalia’s Banadir court fines auto repair businessman for tax evasion

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Somalia’s Banadir court fines auto repair businessman for tax evasion

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Tuesday September 23, 2025

FILE – A mechanic works on a car engine at a garage in Mogadishu.

Mogadishu (HOL) — A Mogadishu businessman has been fined for tax evasion after a court ruled he violated Somalia’s tax laws, in a case officials say is meant to send a warning to other business operators.
The Banadir Regional Court on Tuesday convicted Nuradiin Ibrahim Mubarak, who was accused of running an auto repair business without paying the required taxes. Prosecutors from the Attorney General’s Office filed the case, alleging that Mubarak had repeatedly breached the country’s tax regulations.

After reviewing the evidence, the court ruled Mubarak guilty and ordered him to pay a financial penalty consistent with the offence. The exact amount of the fine was not disclosed.
In a statement, the Attorney General’s Office said Mubarak’s conviction has been entered into the national criminal record, describing it as a clear deterrent to others.
“The Office of the Attorney General warns that any business operating in Somalia must comply with tax regulations,” the statement said. “Failure to do so will lead to prosecution and possible criminal registration, which can severely damage both business prospects and public standing.”
Officials added that taxation is a binding legal duty for all citizens and businesses and that future violations would be prosecuted in court.
Even as Somalia’s revenue institutions slowly take shape, the country is not far removed from a period when tax enforcement was deadly: between 2012 and October 2014, at least 25 municipal tax collectors were shot in Mogadishu’s markets, many while gathering daily dues worth about 25 cents. The attacks often went unpunished and, in 2013–14 alone, 15 collectors were killed, prompting authorities to assign armed escorts for staff in the city’s busiest markets. The government’s struggles are compounded by Al-Shabab and pro-Islamic State factions, which operate their own parallel taxation systems. Al-Shabab, in particular, is estimated to generate tens of millions of dollars annually by taxing trucks, farm produce, livestock, and businesses, sometimes more efficiently than state institutions.

Somalia’s tax-to-GDP ratio stood at just 2.6 percent in 2022, among the lowest globally and far behind the African average of 16 percent.

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