- Electronic record management
- Automatic VAT refund
Rwanda Revenue Authority (RRA) has made a lot of inroads in the use of Information Communication Technologies (ICTs) to ease the collection of taxes and reduce the cost of doing business.
Today, there are a number of online and off-line softwares and technologies aimed at easing every tax payer’s life in and out of the country.
RRA introduced the use of Electronic Billing Machines (EBMs) to facilitate businesses pay for their Value Added Tax (VAT), increase taxpayers’ compliance while reducing the tax collection cost that has always been a factor in developing economies.
This was in line with the government’s need to improve the collection and compliance of Value Added Tax through the use of electronic billing machines that were introduced to all VAT registered taxpayers.
In addition, Electronic billing machines are also important electronic gadget s for taxpayers to manage their stock on a daily basis and keep track of all transactions across the entire business.
The machines are vital in producing electronic receipts quicker and transferring data into RRA servers that in turn help tax payers who claim and get their VAT refund as immediate as possible.
EBM provide a market balance and equal business opportunity to every business person and reduce stationery expenses. The technology enables appropriate tax rate assigned to products on the item as well as the name of the product.
As long as the machine prints a copy, it has the capacity to retrieve such a receipt whenever such need arises, meaning that both the taxpayer and RRA have evidence of transactions made.
Currently, RRA has so far distributed more than 16,000 EBMs and seen more than 2 million receipts printed.
Also, to boost awareness on the use of the machines, RRA started a promotion in September this year, where clients of VAT registered businesses that ask and submit their receipt numbers to RRA stand a chance to win cash prizes every month.
In September, the institution commenced with a new EBM compliance awards where a total of 50 lucky winners were rewarded with Rwf 2.5 million by Rwanda Revenue Authority (RRA) in total. This draw will be conducted on a monthly basis and winners will always be awarded with various prizes and announced in the key selected media channels.
Public views about EBM
“The use of EBMs is of great importance to me,” says Dusabumuremyi Innocent, a prominent business man and a taxpayer in Kabeza, Kigali. The system provides a tailor-made book keeping solution where once every sale detail is filed in the device, the data are recorded on the system and immediately communicated to the RRA system.
“The EBMs has helped me to be better in tax compliance and I am glad to be able to contribute in steering the growth of our country,” Innocent says. He adds that the EBMs will promote fair competition on the market. Where in the past some enterprises evaded taxes hence earning illegal profits, the system is ensuring every one earns his due and pays what belongs to the government hence promoting fairness. It is also reducing financial embezzlement in businesses, corruption and other malpractices.
“As a citizen and consumer, I believe that the system is a very effective means of increasing government revenue which helps the government to provide social needs to the community,” says Mukamutara Claudine, a resident of Remera, a suburb of Kigali city.
These secure devices are very important since consumers know exactly how much they paid for goods or service and tax burden which are clearly justified. “It’s therefore vital for consumers to insist on a receipt for whatever good or service,” Claudine says. She adds that receipts issued have a special electronic signature which can be verified by RRA or the consumer.
The tax body urges buyers to request for EBM invoices and participate fully in the ongoing EBM Lottery so that they can win the available prizes as well as contribute to national development since the VAT paid will be remitted to the national coffers through Rwanda Revenue Authority.
At the same time, traders are required to issue EBM receipts to clients regardless of the size and prices of goods and services sold in order to genuinely collect and remit VAT on behalf of the government because VAT is paid by the last consumer of a particular product or service.