GASABO - Taxpayers should brave tough penalties this year should they fail to pay their taxes on time, Mary Baine, Rwanda Revenue Authority (RRA), Commissioner General announced at a press conference held yesterday at the body’s headquarters in Kimihurura.
In a no-holds-barred address to members of the press, Baine said the measures have been announced after the discovery that most taxpayers make their payments on the final day, which she said overwhelms facilities and personnel of the Authority.
“After a long time of ‘babysitting’ taxpayers we intend to enforce the law that emphasises closure of offices by 4pm. This implies that any taxpayer that will come after working hours on the deadline will have to pay the fines that come with late payment of taxes,” she said.
Adding that many taxpayers have taken the tax body for granted, Baine cited an example of the 90 percent of the 50,000 taxpayers that turned up to pay their road licence fees on the final day last year, despite the fact they had had a long period to clear their dues.
“We were forced to collect their documents so that they could leave the headquarters but still we stayed here and worked over night. It gets really difficult but now, it is high time taxpayers followed the law,” she added.
She said that over the past 10 years, RRA employees have endured longer working hours on the deadline of tax payment. The final straw for the Authority was yesterday, in yet another case when hundreds had queued up to beat the Value Added Tax (VAT) and Pay As You Earn (PAYE) payment deadlines.
This is all bound to change because taxpayers will have to endeavour to clear taxes ahead of the deadlines or else brave the late payment penalties of Rwf 100,000 for small taxpayers, Rwf 300,000 for medium taxpayers and Rwf 500,000 for large tax payers.
RRA has also established various branches that will help reduce congestion at the headquarters and these branches were specifically opened to receive non-fiscal taxes.
While addressing journalists, Baine also hailed the media for their strong partnership in educating the public on tax related issues.
Underscoring the Authority’s achievements, she noted that RRA collected Rwf 338.8 billion against a set target of Rwf 281.4billion in 2008, implying that the tax body exceeded its target by Rwf 68.8 billion.
The Commissioner General attributed this achievement to the growing economy where-by more Rwandans spent highly thus raising the contribution of Value added taxes to 42 percent.
She added that imports also increased considerably with those coming from the East African Community (EAC) and Common Market for Eastern and Southern Africa (COMESA) contributing 30 percent.
In an effort to restrain the tax payment process during peak hours, RRA has also invited different banks to collect these revenues on its behalf.
Only Bank of Kigali (BK) met the required preconditions and it will soon join Ecobank in the exercise of collecting revenues.
Other banks will come on board as and when they fully meet the set conditions, she said. Such preconditions include the information technology system that allows entered data concerning taxes to be accessed by both the authority and the banks.
“Interface between the bank system and tax system is very necessary,” she said adding that banks should also be able to transfer the tax money collected to the National Bank of Rwanda within three days such that government revenue is not utilised by banks for other financial benefits.
Baine also stressed the need for proper self assessment adding that “Many tax payers still carry out under declaration which is absurd. She blamed former RRA employees who, she alleges, actually go back to the public and teach them how to evade taxes.”
In regard to this issue however, tax education has been prioritised with the help of the Private Sector Federation (PSF).
She urged Rwandans to pay their taxes on time to avoid unnecessary penalties and also in the process, enable the government to implement its development plans accordingly since taxes are the only sustainable way to build Rwanda economically.
The set target for the mid year tax collections is Rwf176 billion.