RRA clarification on tax rates

In reference to the article published in The New Times of September 3, 2007 issue No. 1272 under the heading Rwanda taxpayers’ faithful, but………… the authority would like to clarify to the author and the public in general the following:On Corporate income, the author informed the public that, the annual corporate income tax ranges to 70% due to high interest and aggressive penalties.

In reference to the article published in The New Times of September 3, 2007 issue No. 1272 under the heading Rwanda taxpayers’ faithful, but………… the authority would like to clarify to the author and the public in general the following:On Corporate income, the author informed the public that, the annual corporate income tax ranges to 70% due to high interest and aggressive penalties.

The corporate income tax rate is fixed at 30% in accordance with article 41 of law No.16/2005 of 18/08/2005 on direct taxes on income.

The Rwandan laws allow for self assessment. Here the tax administration trusts that the taxpayer declare what is truly right.

The law again allows for voluntary disclosure where the taxpayer at any time before audit can make a rectification adjustment on declarations previously submitted in order to avoid mistakes and eventual penalties.

The law has accommodated taxpayer enough and it is only the taxpayer’s choice to pay penalties because we are supposed to be prudent and if not, a second chance of correcting information is provided.

As regards VAT refund, there are three types of refund that include, automatic refund, privileged persons refund and audit refund.

RRA organizes for a proper verification whether the person is really worthy the refund he/she is requesting for.

Once the amount is not exceeding Frw500.000, there is automatic refund and this does not have to exceed three consecutive times.

If the amount exceeds Frw500.000 an audit of the taxpayer is carried out and within 30 days the refund process is completed since there is a team specifically charged with the refund.

The issue on decentralized taxes is currently being re-visited.

The Ministry of Finance and Economic Planning set up a commission comprised of different stakeholders to handle it.

The commission will review the law regarding income generating activities for towns and districts and establish the list of other taxable goods.

Differentiated excise duties, the law on consumption tax on some imported and locally manufactured products provides for specific rates on given products.

Article 6 of law No.26/2006 determining and establishing consumption tax on some imported and locally manufactured products, stipulates that, the taxable value on imported products shall be calculated according to cost, insurance and freight upon arrival in Kigali while locally manufactured products, it shall be calculated according to selling price exclusive of taxes.

This implies that the local product are most favoured compared to Imported products.

The Frw30.000 threshold being too much to boost the purchasing power and support growth of the industries in Rwanda, it should be noted that originally this threshold was at Frw15.000 which is quite fair now to exempt the Frw30.000 instead of Frw15.000.

Regarding appeals of a dissatisfied taxpayer by RRA decision, article 30 of law No.25/2005 of 4/12/2005 on tax procedures stipulates that, the taxpayer who is not satisfied with the content of the tax assessment notice may appeal to the Commissioner General within 30 days after receipt of the assessment notice.


Article 34 of the above mentioned law states that, the taxpayer who is not satisfied by the decisions of the commissioner General may appeal to the Appeals Commission established by the Prime Minister with in 30 days after the receipt of the Commissioner General’s decision.

The taxpayer has a right to appeal to the courts of law with the competent authority once he/she is not satisfied with the decisions of the appeals commission from the office of the Minister of Finance. This has to be within a period of 30 days after the receipt    of decision from the appeals commission.

We urge every interested person writing anything concerning taxes to always approach our offices for clear and proper information to feed the public.

The office is always open for anyone requesting all kinds of information related to taxes and duties in Rwanda.

The Director of Taxpayer Services Department
Rwanda Revenue Authority

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