By Emmanuel Ntirenganya
Revenues brought in the national economy, through Rwanda Revenue Authority (RRA), amounted to Rwf1,103 billion in 2016/2017 financial year, which is 100.8% its target of 1,094.3 billion, according to the revenue body.
RRA Commissioner General, Richard Tusabe said that some of the factors that helped RRA to further improve its revenue collection services include ICT and technology.
The technology includes the use of Electronic Billing Machines (EBMs), and the introduction of electronic cargo tracking system, which Tusabe said has immensely contributed to free movement of goods and services.
Tusabe was speaking from Kigali Convention Center on Friday, October 13, 2017, during the 15th Tax Payers Appreciation Day, an annual event organised by RRA, which aims at showing achievements in tax collection and appreciating compliant taxpayers.
During the same event, “Ecole la Colombiere” and “Clinique St. Jean” were awarded as Best Taxpayers of 2016/17.
Also, today, a tax payer has not to go on a long queue waiting for tax services or pay for due taxes at RRA offices, rather mobile phone-based applications are enabling them to declare their goods and services they offer, and get short messages telling them how munch they should pay accordingly, hence ensuring efficiency in service delivery.
According to RRA Annual Activity Report 2015/16, the 2015/16 fiscal year total tax revenue collections amounted to Rwf986.7 billion, an achievement rate of 104.3%.
Since RRA introduced EBMs in 2013, they helped collect about Rwf110.5 billion in Value Added Tax (VAT), which increased to Rwf169.5 billion in 2014, while it went up to Rwf196 billion in 2015 , and Rwf220 billion in 2016, according to information from RRA. These statistics show that EBM system resulted in VAT increase of over 90 percent since its inception.
Prime Minister Edouard Ngirente said that revenues contributed about 56.4% to the national budget, while it is expected they will account for 66% of the national budget in 2017/2018 fiscal year.
Giving a comparison on how revenue collection and national budget evolved, Premier Ngirente said that Rwanda’s budget was Rwf173.2 billion, of which taxes accounted Rwf68.4 billion, representing 34.5%.
“We are happy that the revenues that our country collects continue to increase year by year,” he said, thanking all taxpayers who contribute to the realisation of tax compliance and good revenue sector performance.
The Chairperson of Private Sector Federation in Rwanda, Benjamin Gasamagera said that in the year 2016/2017, PSF members contributed 79% of total taxes collected.
“It is gratifying and something to be proud of to hear that they (members of the private sector contribute to the country’s developmet, which encourages us further,” he noted.
Referring to improvements made in revenue collection, especially through ICTand technology, Gasamagera said “the development that RRA brought to taxpayers further facilitates them to fulfill their responsibilities.”
However, technology gives good results when used correctly and profitably.
To this end, he thanked compliant customers who request receipts generated by EBMs.
RRA concurs with members of parliament that there are still issues in EBM system such as traders who are reluctant to give EBM generated receipts, which necessitated that RRA deploy many workers on field countrywide to ascertain whether EBMs are being used properly.
Parliamentarians also expressed concerns in May, 2017, that some traders connive with buyers to record wrong prices on receipts that are not produced by EBMs, with intention to illicitly share earned ‘profits’.
Strengthening use of EBM and its monitoring
Tusabe noted that RRA pledges to exploit the use of technology& tax education for Taxpayers to ensure we develop Rwanda together.
By March 2016, a total of 10,394 VAT registered taxpayers had EBMs. That uptake represented an increase of 28.4% in a period of 9 months from 8,096 by June 2015.
RRA states that the widespread and constant use of EBMs continues to be its key priority.
To further incentivise customers to demand their EBM receipts, the recently launched EBM lottery campaign (“Izihirwa! Buri wese aratsinda!”) offers the opportunity to win cars, motorbikes, TVs, cash prizes and more.
Broadening taxpayer base
Activities targeting broadening of the tax base through taxpayer registration were carried out focusing on specific sectors, according to RRA. These included commercial houses (for VAT on rental income), garages, car washing bays, private schools and driving schools.
As a result, the total number of taxpayers increased by 16,971 (11.6%) as of end March 2016 when compared to the status of end June 2015.
In line with widening the source of revenues, Premier Ngirente said that the Government continues putting in place strategies aimed at easing doing business.
He noted the strategies include improving domestic revenue collection systems, setting up new infrastructures and rehabilitating old ones, promoting made in Rwanda products, and increasing both the volume and the value of Rwanda’s exports.