Make tax evasion a risky venture

Rwanda Revenue Authority (RRA) has disclosed that it cracked down a notorious ring of tax evaders. The investigations established that the tax body had lost over Rwf5 billion within a period of 15 months to the scam.The RRA boss made a startling revelation that some traders had resorted to creating ghost companies for the purpose of tax evasion. The government goal is to gradually reduce aid dependence until it will finally wean itself off it. However, this objective may not be achieved soon if taxes are evaded on such a large scale. It is a fact that there are cross border loopholes which tax payers take advantage of to avoid paying tax. There are cases of several people captured trying to smuggle goods into the country.Although there are no official figures of what tax fraud and evasion cost the government, the act is sabotage to national development. It also leads to unfair competition with genuine traders who dully meet their tax obligation. If the government revenue objective is to be achieved, RRA must step up awareness campaigns about the benefits of paying taxes.Cross border trade has become lucrative because of the tax waiver on some goods originating from the region; joint efforts to tackle tax evasion are therefore critical. The East African Community (EAC) should make the fight against tax evasion and tax avoidance a priority as part of regional efforts to achieve self reliance. There is need for a common ground on hunting down tax defaulters in the region. Government should step up the crackdown on tax evaders and make tax evasion a risky venture.

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Make tax evasion a risky venture