The Cabinet on Monday, June 9, approved over Rwf7 trillion the government plans to spend in the 2025/26 fiscal year, which will commence on July 1. This envelope represents a 21 per cent increase – or over Rwf1.2 trillion compared to more than Rwf5.8 trillion approved for the current fiscal year. According to the Office of the Prime Minister, the increase reflected in the financial plan is expected to primarily fund strategic investments, including the New Kigali International Airport – being constructed in Bugesera – and key development priorities such as job creation, industrialisation, boosting agricultural productivity, scaling up decent housing, expanding electricity access, improving access to clean water and sanitation, strengthening the transport system, and upgrading education and healthcare. A significant portion of the budget will be domestically funded, reflecting continued progress towards sustainable financing. ALSO READ: How Rwanda plans to fund, spend Rwf7tn budget for 2025/26 As per data from the Ministry of Finance and Economic Planning (MINECOFIN), domestic revenues are projected to reach Rwf4.1 trillion. This accounts for 58 per cent of the total budget estimates in 2025/26, which reflects an increase of 19 per cent compared to more than $3.4 trillion for the current fiscal year (or 59 per cent of the total spending for 2024/25). Domestic resources comprise over Rwf3.6 trillion from tax revenue, which is Rwf677.6 billion or nearly 23 per cent higher than budget of 2024/25, and Rwf477.2 billion from other revenue collection. ALSO READ: Social protection, agric budget drops not good for economy – lawmakers say MINECOFIN indicated that the increase in the tax revenue projection will reflect the current and expected good performance of economic activities with the effect from the recently approved tax policy reforms and other tax measures under the medium-term revenue strategies. According to a budget framework paper covering three-year government spending priorities and fiscal policy from 2025/26 to 2028/29, domestic resources in the next financial year will be supplemented by external resources expected to reach an estimated more than Rwf2.7 trillion – or more than 38 per cent of the total proposed spending. This amount comprises Rwf585.2 billion from grants and over Rwf2.1 trillion from loans. The projected external loan amount for the coming fiscal year 2025/26 will be Rwf648.4 billion higher compared to more than Rwf1.5 trillion in the revised budget of the current fiscal year. Grants are projected to decline by 5.7 per cent compared to Rwf621.2 billion of the current 2024/25 budget. The Minister of Finance and Economic Planning will table the budget bill to Parliament for approval this June before the beginning of the next fiscal year begins in July.
