KIGALI - A local construction company, Thomas & Piron Grand Lacs, a subsidiary of Thomas & Piron of Brussels, Belgium,  is battling a tax evasion case worth over Rwf 900 million, The Sunday Times has learnt.

The case, which the company lost last year, has been transferred from the Commercial High Court to the Supreme Court on appeal.According to a reliable source, the company imported construction materials worth over Rwf 800 million through its headquarters in Brussels.

"In a company like that, all expenditure is recorded and RRA will base on every detail of its transactions to tax it,” the source who did not want their names revealed, said.

"Every unit for taxation is in percentages. In this case, Thomas & Piron’s records indicate that its taxation percentage per unit range from 0,5,15, and 30 but RRA wanted to tax all units at 30 percent,” the source explained.

"I don’t know how they came up with over Rwf900m but they have the power to multiply the evaded tax by the number of times they choose basing on their calculations,” Joseph Twilingiyemungu, a lawyer representing Thomas & Piron Grand Lacs told The Sunday Times yesterday.

He said that his client had an agreement with Belgium based Thomas & Piron to be buying and sending them construction goods from Europe. They in turn would be earning a commission.

"Article 53 of the Customs Law establishing the customs system exempts commission as a unit to be considered when taxing.

The only mistake I see is that the Belgian based Thomas & Piron bought goods but made another separate receipt as if they are the ones selling goods, which might have triggered RRA to say it was not a commission.

But in reality that company does not manufacture goods,” Twilingiyemungu explained.

"You cannot just tax a service; why not add this service to other units to be considered for taxation? The problem is that they want to tax the commission alone.”

RRA officials told The Sunday Times that they are prohibited by the law from saying anything about their clients.

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