Taxation in Rwanda

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Government decision to drop plans to levy 5 per cent income tax on the value of sale or free transfer of immovable property such as houses and land is a welcome move for Rwanda’s estate development, home owners said.

Rwanda’s construction industry has been growing over the last 5 years as manifested by the high rates of urbanisation and increased demand for housing and infrastructure across the country.

Ever since the tax body introduced Electronic Billing Machines (EBMs) over two years ago, many taxpayers have been complaining about challenges they face in using the machines. Some say the machines are also expensive while others claim invoicing using EBMs slows down operations.

The Government is looking to technology to boost tax administration and revenue collection to finance next year’s budget, with Finance Minister Claver Gatete proposing to purchase Electronic Billing Machines (EBMs) to bring all value added tax (VAT) eligible persons into the tax loop.

Rwanda expects to have a new investment code at the start of 2015 that could offer incentives such as seven-year tax holidays for bigger investors and sharply lower corporate taxes, a senior official said on Tuesday.

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