Yesterday we reported that the Southern province collected Rwf 5.5bn in taxes. And, according to Rwanda Revenue Authority’s (RRA) Commissioner for Domestic Taxes, the tax body now contributes more than 50 per cent to the National budget.
This is a sign that Rwanda’s goal of reducing aid dependence is within reach.
Taxes, the world over, are a complicated issue and many a time, people are looking for loopholes within the system to evade their responsibility. Although there are stringent laws that punish defaulters, the problem still persists and has an impact on the country’s development plans.
While impressive work has been done in areas of legislation and enforcement, there is need for more emphasis on sensitization of taxpayers.
There are people who do not pay their taxes because they do not know how to calculate it or need to understand how taxes contribute to national development. RRA should take a lead in ensuring that procedures for payment are not complicated and are taxpayer-friendly.
Once people get a better understanding of how the taxes contribute to the country’s progress, they will become more compliant, thereby, not only increasing the revenues, but also widening the tax base.