Managing Director of Rwanda Motors, Hugues Lefebvre, said high taxes are hurting vehicle business. “We pay 100 per cent before servicing the vehicle,” he said. But Rwanda Revenue Authority (RRA) says the taxes are competitive, low in the region and have been reducing over years. Mary Baine, the Commissioner General RRA however says that with the East African Community Customs Union, import duty will reduce further from the current 30 per cent to 25 per cent. She said investors could be complaining because of the tight enforcement by RRA.
Baine said this while addressing 100 top investors in the Country at Hotel de Mille Collines in Kigali on Friday 23. The investors dialogue was organised by RRA to chat out ways of facilitating business growth in the country.
The theme of the dialogue was, “Be a compliant tax payer. Build your nation.”
According to a breakdown of taxes—importers have to pay withholding tax of 5 per cent, import duty of 30 per cent and VAT 18 per cent. The investors said the high tax system disrupts and distorts a vast array of business and investment decisions.
In 1995 importers of luxurious vehicles used to pay 220 per cent import duty, it dropped to 100 per cent, then 60 per cent and in 2000 it reduced to 30 per cent.