Budget Day: Call for larger tax base

The Minister for Finance and Economic Planning, Claver Gatete, will this afternoon, appear before a joint parliamentary session to present the budget for government expenditure during the financial year 2016/17.

Wednesday, June 08, 2016

The Minister for Finance and Economic Planning, Claver Gatete, will this afternoon, appear before a joint parliamentary session to present the budget for government expenditure during the financial year 2016/17.

The Budget Reading will be held simultaneously within the East African Community partner states.

In Rwanda, the Budget will most likely reflect the Budget Framework Paper (PFB) that was recently presented to parliament, which indicated an increment of the national envelope from Rwf1,768.3 billion in 2015/16 to Rwf1,949.4 billion.

The increase, according to officials, will help Government absorb and contain projected global economic shocks maintaining a moderate growth of the economy and subduing inflation at below 5 per cent.

The rise has also been attributed to projected good performance of domestic tax administration, which experts have commended, mainly due to the efficiency ushered in by the electronic billing machines.

However, they call for more efforts to expand further the tax base by deepening the supply of the machines to more business operators.

This, according to many, will not only spur collections but keep the economic growth within the loop.

"That was very commendable in terms of performance from last year’s Budget; however, in the upcoming fiscal year, government will need to apply even more bold strategies to have everybody captured, especially in the VAT registration and in the service industry,” said Angello Musinguzi, a senior manager at KPMG.

The tax expert, on the other hand, decried persistent challenges in the mining sector, which he said need to be given serious attention, especially on how withholding and loyalty taxes can be reduced to help players cope-up with the global price shortfalls.

"Positive changes in the mining sector will trickle down to income generation and job creation, and through value addition, will result into sustainable growth of exports,” he added.

Musinguzi and other members of the public, called on the government to turn focus in the agriculture sector, which they said employs more people but remain grounded in terms of investments such as irrigation and mechanisation based.

Additionally, the Government, according to Musinguzi, will equally need to allocate a big chunk of the national cake towards the education sector in the effort to increase capacity and skills which in turn will bolster the competitiveness of the Rwandan workforce.

The Government seeks to reduce further donors’ contribution toward the National Budget and at the same time maintain the debt ceiling considerably low. The Budget Framework Paper shows a donor funds (grants) reduction of Rwf9.4 billion from Rwf374.7 billion.

editorial@newtimes.co.rw

What should the Budget focus on?

Emmanuel Sibomana

Emmanuel Sibomana. ‘Education is the engine of sustainable development. Educating a child is preparing a better future of the country. In rural areas, most of the children do not attend school because of vulnerability of their families.

The Budget should emphasise more on education to support vulnerable children. Development should not be limited to just infrastructure, but also focus on improving people’s welfare. For instance, under 12-Year Basic Education, some schools ask parents to pay Rwf10,000 per month for feeding and this is a burden to vulnerable families.

Pierre Claver Nzeyimana

Pierre Claver Nzeyimana, Ngoma resident. ‘Agriculture is the ‘bread basket’ for the country, there is need to provide more fertilisers to increase production, but some people can still not afford fertilisers and quality seeds. These should be helped and, as a result, they will not only be economically empowered and the country will have sufficient food supply.

Cyprien Ndayisaba

Richard Nikuze, a motorcyclist. ‘In the upcoming budget, I want the focus to be on the health sector to ensure everyone gets access to primary healthcare. Currently many people are still struggling to get Mutuelle de Santé. Even those that manage to pay their premiums, there are many services we do not get with Mutuelle. I think more money should be put into the sector to ensure we get more and better services.’

Cyprien Ndayisaba, a security guard. ‘The Government should allocate enough money on improving

Cyprien Ndayisaba

infrastructure such as roads, electricity, among others, mainly in rural areas. This will solve the problem of youth who leave their villages hoping to get better living conditions in towns.’

Placidia Murekatete

Placidia Murekatete. ‘Some parents still cannot afford all school requirements for their children. Currently, the only legacy you can give your child is a good education. There are some children who complete primary education but fail to proceed because of poverty.’