Rwandans have been challenged to consider taxation as a patriotic duty as the country’s self-reliance initiative gains ground. 

Speaking during the launch of the 14th Taxpayers Appreciation Day 2016, Dr Uzziel Ndagijimana, the Minister of State for Economic Planning, said the push for self-reliance is bearing fruit as indicated by the increase in domestic tax collections for budget support.

He noted that the country will fully achieve its goals if the Rwandan people work together and respect tax obligations.

Ndagijimana, however, said though domestic revenue collections are going up, Rwandans should pay their taxes in time to support the country’s development objectives. The minister attributed the increase to the growth in the self-reliance culture among the Rwandan people.

"We will raise Rwf1,084.4 billion or 55 per cent of the budget from tax revenues,” the Minister said. About 62.4 per cent of the Rwf1,949.4 billion 2016/17 financial year budget will be funded by domestic resources.

This year’s Taxpayer’s Appreciation Day will be conducted under the theme, "Voluntary tax compliance, the pillar of self-reliance”.

The Commissioner General for RRA, Richard Tusabe, said 2015/16 tax revenue collection grew by 14.5 per cent compared to the previous year.

"The total tax revenue collected amounted to Rwf983.4 billion, exceeding our target of Rwf949.2 billion by Rwf34.2 billion,” he said.

Commenting on the event, Tusabe said the objective of the Taxpayers Appreciation Day is to strengthen partnership between RRA, private sector and local governments in a bid to drive up tax compliance among current and potential taxpayers.

"We will emphasise the role of voluntary tax compliance to stimulate the culture of self–reliance among Rwandans,” he added.

Friday’s event was targeting taxpayers from the Southern Province, while other similar events are planned for coming weeks. Alphonse Munyentwari, the governor of the Southern Province, said the province collected Rwf23.4 billion domestic tax revenue last financial year, above Rwf18.9 billion targeted. This indicates a 123 per cent performance rate or Rwf4.4 billion above target.

Provincial best taxpayers rewarded

Meanwhile, the best tax payers in Southern Province were awarded during the event. The awardees include Jean Bosco Bigirimana, the deputy director general for Horizon Express.

Bigirimana lauded RRA for its efforts aimed at establishing a strong link with taxpayers, saying the move will improve compliance and spur collective national building objective. '

In addition, a new drive, "Here for you” was also launched as the tax body promised to serve taxpayers in a "friendlier, helpful and professional manner”.

Why improve tax compliance

According to RRA officials, the impressive performance was driven by strong tax education and sensitisation, coupled with government support, and joint mobilisation with Private Sector Federation, local authorities, security organs and the media. They said use of electronic billing machines (EBMs) had significantly improved VAT administration.

However, RRA said there are still challenges that are negatively affecting tax compliance, including tax avoidance, reluctancy by some taxpayers to use EBMs, and smuggling. The fact that the informal sector is still big also affects collections because of the narrow tax base. Sectors like construction and hospitality were identified as ‘high risk’ for their non-compliance, while some businesses changed names to dodge outstanding taxes.

Efforts to ensure compliance

Tusabe said the tax body will be conducting joint tax mobilisation drives with other stakeholders to promote voluntary taxation, arguing that the move is essential to reduce dependence on foreign support. He also urged consumers to always ask for EBM invoices to encourage compliance and businesses. "We are also going to increase our vigilance and fight against tax evasion and smuggling,” he noted.

Taxpayers’ day calendar

The Taxpayer’s Appreciation Day is organised annually and marked across the country. A similar event will be held in Karongi District, Western Province on July 27, while the one in Northern Province is slated for August 2; that of Eastern Province is set for August 8, and the national level event will be held in Kigali.