MTN wins best taxpayer award

MTN Rwanda paid Frw14.5 billion to the treasury in taxes in the last fiscal year, emerging as the best overall taxpayer for the second time in a row during the 7th annual Rwanda Revenue Authority’s (RRA) Tax Payers’ Day on July 12. From providing internet and mobile services, the company’s contribution has grown by Frw3 billion, from Frw11billion in 2006 to Frw14.5 billion in 2007. “We look at RRA as a partner not an adversary. MTN plays a pro active role. In fact when there is anything new, we seek clarity,” said Anthony Mazosera, MTN Rwanda’s chief financial officer. He was explaining why they have remained best overall tax payers in the country. MTN Rwanda is a subsidiary of the South African conglomerate and the company managed to beat the other corporations because of its high degree of compliance. Rwanda Breweries and Soft Drink manufacturer (BRALIRWA), which has a market share that is estimated at 95 per cent and an estimated turn over of Frw50 billion, was also reorganised. Door Plantenga, Managing Director of the beverage company, told The New Times that the company contributed Frw29 billion in taxes, 60 per cent of which was excise duty and the rest was VAT and import duties. MTN Rwanda, Electrogaz, Ameki color and World Vision Rwanda topped the list of 25 best taxpayers. Electrogaz and World Vision Rwanda are joining the top five for the very first time. In the banking sector, Bank of Kigali (BK) took the leading position, but was not ready to release how much it paid last year. Commercial Bank of Rwanda (BCR) followed in second place, paying Frw316 million. “We were not looking at the amount. It was the compliance,” Eugene Torero, Rwanda Revenue Authority (RRA) Deputy Commissioner, explained the criteria used, for choosing the best tax payers in an interview last week. The colourful ceremony, which was also RRA’s 10th anniversary, was held at the tax body’s headquarters in Kimihurura, Kigali and presided over by President Paul Kagame. The president urged tax payers to be more compliant, saying it was the only way for Rwanda to be economically independent. He thanked RRA for rehabilitating the country’s borders adding that there is need for good quality services—24 hours a day. The president suggested that Rwandan officials at Gatuna border should look beyond the time difference and open and close at the same hours like their Ugandan counterparts at Katuna. RRA Commissioner General, Mary Baine, thanked the private sector for their significant contribution to the growth of the country’s domestic revenues adding that this will eventually lead to financial independence. The Commissioner General announced that this year they have a target of collecting Frw275billion in taxes. Should the target be met, internally generated revenue would fund more than half the country’s budget. “We started with a collection of Frw62 billion in 1998, however, last year we collected Frw252 billion. We have always met our targets mainly due to the increased compliance levels over the years,” she said. Other big tax payers that contributed heavily to the national treasury included Total Rwanda, SONARWA, Serena Hotel, the government warehouse (Magerwa), Cocirwa, ORPTN and Cimerwa among others. Faustine Mbundu, chairman for the Private Sector Federation, attributed the increase in compliance levels to the tax payers’ ongoing education and improved services that are offered by the tax body. He also noted that RRA should find means to reduce the long queues of taxpayers at banking halls. Mbundu also pointed out the need for government to consider improving the quality of products within the country so as to boost the economy instead of importing exactly what is produced within the country. “Economic development will be realized sooner if we improve the quality of our products rather than importing exactly what we produce here. For example why should we import high quality sugar when we can improve the sugar quality of Kabuye Sugar Works?” he asked. He pledged to support, RRA in their bid to help the tax payers to fulfill their obligations. RRA’s decade journey has not at all been rosy as it has been faced with a number of challenges, including slow service and corruption. Over the years, however, the organization has managed to transform itself into a modern tax body through increasing the capacity of its staff. Priority has also been given to effectively fighting corruption and smuggling through the establishment of the Revenue Police Department. Ends