Are you a value added taxpayer who uses an Electronic Billing Machine? The machine is in the process of becoming obsolete.
Rwanda Revenue Authority (RRA) is in the process of replacing the Electronic Billing Machines with an internet-based software that will be offered for free to all VAT registered taxpayers.
The software, dubbed EBM Version 2, will replace the gadgets that have been in use since 2013 which the authority says have become obsolete as they are based on an outdated technology.
Installation of the software began on Monday this week at the RRA headquarters where taxpayers are also receiving training on how to use the new system.
Businesses only require a computer (which can be used for other purposes) and a printer to produce invoices.
RRA Deputy Commissioner General Pascal Bizimana said that the development is expected to address outstanding issues with the current devices such as maintenance.
Unlike the old device, the new software will also serve to capture stock enabling balance of stock of sales.
This function, he said, will make it easier for taxpayers to declare their taxes as they will have access to their data.
It will also make it impossible for taxpayers to defraud RRA when declaring taxes as has often been the cases, under previous systems.
Jean-Louis Kaliningondo, the Strategic IT adviser to the Commissioner General, said that the new technology is built to address concerns that were experienced in the use of the machine.
“The EBM was based on a technology that was relevant at the time but no so relevant currently given the new technologies entering the market now. They were turning obsolete. For instance, most people use computers, POS machines and the EBM machines which make it too much hardware to use,” he explained.
“Given the fact that the EBMs were introduced in 2013, about 95 per cent of the machines we have are over three years old,” he added.
Current users of the machines will be given a grace period that is unlikely to exceed June 2019, he said.
“Everyone will be required to have the latest version at some point as it has multiple benefits compared to the previous version,” he said.
Among the aspects its likely to benefit RRA is that it will reduce the cost of revenue collection in regards to maintenance and activation of the device.
“With the new system, you do not need to move from your place of work, as long as you have internet connection, we can help you from your location,” Kaliningondo said.
The software is a product of Rwanda Revenue Authority technicians who worked with support of Korean International Cooperation Agency for nearly two years to develop it.
Joel Ntihemuka, the deputy commissioner of ICT at RRA, said that all the engineers maintaining the system are local, ensuring sustainability.
On installation of the software in their machines, users are taken through a brief training at the RRA office to equip them with skills for usability.
The solution was put through a test phase with about 320 people using it at the moment.
Comparing the costs, the software is installed for VAT taxpayers for free while the device cost between $200 and $300.
Retailers and wholesalers of the EBMs will be notified by the RRA on when to cease selling the gadgets, officials said.
Internet service providers are set to see increased demand for their services as the new software requires internet while in use.
Phillip Murindahabi, the proprietor of a firm involved in IT appliance sales told, The New Times that so far, following the the software, he had found it user-friendly and with multiple benefits compared to the previous version.
RRA is working on new models of the software which could see taxpayers use smartphones as well as versions for business outlets that have separate invoice techniques such as banks, insurance companies and hotels.
It is estimated that there are about 20,000 EBMs in use in the country.
RRA collected Rwf196.6 billion in value added tax in the first half of the current financial year during the period between July to December where the authority collected tax revenues of Rwf582.7 billion surpassing their initial target by about 10 per cent.
The new software is expected to address challenges such as instances where EBM machines have previously been used by fraudsters attempting to swindle funds using by using the machine’s invoices to claim value added tax inputs against fictitious sales.
In 2016, 25 EBM machines were found to be engaging in such practices and had generated invoices worth a total of Rwf38 billion which would have resulted in VAT of about Rwf6.8 billion.