Rwanda registers increase in tax revenues

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Rwanda Revenue Authority (RRA) has recorded an increase in the taxes collected as a result of the use of Electronic Billing Machines (EBMs) by the business community, according to the Revenue body’s Commissioner General, Richard Tushabe.

Tushabe said that the last quarter of fiscal year 2014/15 saw the tax body collect over Rwf470.6 billion in revenues and value added taxes making an increase of Rwf8.4 billion in taxation targets and increasing the VAT targets of Rwf5.1 to Rwf7.1billions.

The revenue body did not however, hit the targets for district revenues by collecting Rwf13.4 billion instead of Rwf14.9 as presumed between June and December 2015.

In the fiscal year 2014/2015 which ended in June last year, domestic VAT collection realized a growth rate of 10.6%, thanks to the use of Electronic Billing Machines.

“There was an increase in the use of Electronic Billing Machines and we had registered at least 9 726 new users in the systems. This has been a success but we still need tax payers to pay their arrears so as to meet our targets,” Tushabe said.

Rwanda Revenue Authority introduced the use of Electronic Billing Machines (EBMs) in 2012 to facilitate businesses pay VAT and increase tax-payer compliance while reducing the tax collection/administration costs.

To-date the revenue collection agency has so far distributed more than 16,000 Electronic Billing Machines and seen more than 2 million receipts printed. Also, to boost awareness on the use of the machines, RRA started a promotion in September last year, where consumers who request for EBM receipts from VAT registered businesses participate in a monthly EBM Lottery to walk away with cash prizes.

The tax body is optimistic that with increased usage of the machines and the constant reminder for people to always request for an EBM receipt after purchasing a good or service from a merchant, they will be able to have increased VAT collections.
Rwanda Revenue Authority continues its focus on priorities such as increasing the use of EBMs and carrying out sensitization and educational campaigns to remind tax payers to fulfill their obligations of contributing towards Rwanda’s economic growth.

The tax body has set new targets of making Rwf507.46 billion in the next six months of which Rwf494.16 billion will be collected in taxes and VAT while Rwf13.3 will come from grass roots. RRA has hired local firms to assist in collecting more taxes at the district level.

Some tax payers however, say that the fines for delayed tax declarations are still too high even when done online. They also say that the banking systems still lack capacity to handle surging numbers of tax payers especially on deadline days.

“We have to make long queues while paying the taxes because banks lack enough counters and tellers. This is why most people get to delay and in the process they are liable to fines,” one tax payer told this website.