The government has introduced a new tax on foreign digital services like Netflix and Amazon among others. The development was announced on Monday, February 10, by the Minister of Finance and Economic Planning Yusuf Murangwa during an interview with the national broadcaster. “Many Rwandans use technological services from outside the country, for example Netflix, Amazon and others. On such services we have agreed to levy a tax,” he said. The New Times understands that before the roll out of the tax, the country carried out an extensive study to understand the dynamics of the digital economy and how it can play a role in economic development. The study involved the collection of primary data from institutions like the National Bank of Rwanda (BNR), and the Rwanda Utilities Regulatory Authority (RURA). It also explored a number of grey areas” that need to be understood as far as the local digital economy is concerned, so that policy makers would ably take appropriate decisions. Finding out what digital services are consumed locally, their suppliers and consumers, among other things, was also a key target for the study. With such information and more, researchers were equipped to make an analysis as part of the plans for promoting the country's digital economy. The New Times understands that foreign digital companies that offer services in African countries like Rwanda, have always paid VAT in their own home countries. Previously, Angello Musinguzi, a Senior Tax Manager KPMG East Africa Accounting Organisation, told The New Times that the move to levy taxes on digital services would boost the country’s tax collection, but noted that there is need for tools to execute it well. Foreign digital services are enjoying a lot of clientele in various parts of the world and are generating billions of dollars that way. For instance, as of February 2025, Netflix had over 300 million paid subscribers worldwide. The number includes subscribers in over 190 countries.
