Rwanda Revenue Authority (RRA) surpassed its revenue collection target for the financial year 2018/2019, collecting Rwf1,421.7bn against the target of Rwf1,392.1bn, representing an excess of Rwf29.6bn.
The Commissioner-General of RRA, Pascal Bizimana Ruganintwali, said that the achievement is a result of factors such as strong economic performance and improvement in taxpayer compliance.
The value and proceeds from imports also recovered by growing by about 17 per cent. Previously, proceeds from imports have been growing very mildly.
In the financial year 2019/2020, RRA is aiming at collecting Rwf1,535.8 billion which is about 54 per cent of the national budget. Towards the targets, the agency aims at further rolling out digital instruments to ease compliance. Among the sectors that they aim to increase compliance in include Information and Communication Technology sector, Hotels, bars, restaurants and custom brokers.
RRA is also seeking to reduce the amounts owed to the business community in tax refunds.
Tax refunds come about after having taxes withheld on earnings that amount to more than what a person owes in income taxes for a calendar year.
To process the refunds, RRA cross-checks the documents of the taxes filed and has to verify the cause of over-payment to discover the surplus amount.
As of today, RRA owes about Rwf20 billion, down from Rwf30 billion in February this year.
In the just-concluded financial year, Aimable Kayigi, the commissioner for Domestic Taxes at RRA, said that they had paid about Rwf62.3bn in refunds.
The office was allocated about Rwf8bn for the backlog in the recent budget which could further be revised upwards during the budget review process.
The agency has since commenced refunding value added tax to members of the business community within 30 days after application.
To ease the payment by RRA, the Ministry of Finance and Economic Planning raised the VAT threshold from 10 per cent to 12 per cent with the markup enabling claims.
The agency is also staying up at night to tackle smuggling and fraud. The most smuggled goods included alcoholic beverages, second-hand clothes, beauty products among others.
The most popular smuggling tactic is to import goods and send them to a neighbouring country then find a way to smuggle back into the country.
editor@newtimesrwanda.com