EAC records impressive revenue growth

Member states of the East African Community (EAC) registered general improvements in tax collection, this year, owing to coordination of policies and sharing of information among tax authorities. On Rwanda’s part, cumulative revenue for the first three quarters of 2010/2011 was US$ 594 million (about Rwf354 billion) against a target of US$563 million (about Rwf335 billion). This represents a 21 percent increase from the same period last year. “The good performance was boosted by increased volumes and value of imports, payment of dividends to shareholders by some companies as well as increase in Pay As You Earn registration,” Richard Tusabe, Deputy Commissioner General of Rwanda Revenue Authority (RRA) said yesterday, during the 31st East African Revenue Authorities Commissioners’ General Meeting hosted in Kigali yesterday. “Important as well, VAT invoicing operations were conducted all over the country bringing into the tax net new taxpayers and increased revenues”. Uganda’s net revenue collection between July 2010 and April 2011 was recorded at US$1.71 billion against a target of US$1.7 billion. The performance was attributed to international trade taxes surplus, according to Patrick Mukiibi, the Commissioner in the Tax Investing Department of URA. “Domestic taxes performed well mainly due to price wars in the telecoms sector as well as Refunds paid to the electricity sub sector that had been withheld by Government,” Mukiibi said. Despite being a new body, Burundi Revenue Authority (BRA) managed to reach its target, recording a growth rate of 23.8 percent in 2011 which was attributed to the rapid disciplining and streamlining of the body’s functions. “I can say that 2011 is the real first functioning year of BRA. We have coordinated with member states to train our employees so that they manage the unique structure and carry out innovative tax collection initiatives,” Kieran Holmes, the Commissioner General of BRA said. Tanzania also performed well in the period between July 2010 and March 2011, realizing a performance rate of 93 percent. However, Kenya Revenue Authority (KRA) recorded a deficit of US$ 142 million after accumulating revenue worth US$ 6.3billion in the first ten months of 2010/11 against a target of US$ 6.5billion. Michael Waweru, Commissioner General of KRA, said that the underperformance resulted from poor performance of Excise duty, Domestic VAT and PAYE. “Whereas the rising prices on world oil markets were expected to undermine performance in the oil sector which is volume driven, the sector’s performance was complicated by disputes within the sector especially between large oil marketers, the energy ministry and regulators,” he said. The tax bodies identified some of their biggest challenges to be the narrow tax base worsened by tax exemptions, tax evasion as well as an increased smuggling of goods across common borders. Ivan.mugisha@newtimes.co.rw

National

EAC records impressive revenue growth