Accountants, tax advisors introduced to changes in new tax laws
Rwanda Revenue Authority (RRA) held a workshop on Wednesday, June 4, with public accountants and certified tax advisors to discuss changes in the new tax laws.
This event provided a platform for participants under their associations-- ATAR and ICPAR—to share their insights as the new laws come into effect.
The tax policy reforms are part of the government’s efforts to increase the tax-to-GDP ratio from the current 14.6% to 18.2% by the 2029/2030 fiscal year, as Rwanda aims to achieve a middle-income status by 2035.
Many of the new legal provisions came into effect upon their publication on May 29, 2025. However, to ensure smooth implementation, others will become effective on 1 July 2025. These include VAT, a 5% Withholding Tax (WHT), Excise Duty on hybrid vehicles, VAT on the transport of goods, 0.2% environmental levy, and a 3% tourism tax on accommodation.
The new VAT provisions removed exemptions for petroleum products and land transport services of goods. However, international transport of goods remains zero-rated.
Roy Gasangwa, Acting Assistant Commissioner in charge of the Planning, Research, and Statistics Division, encouraged businesses to register for VAT to be able to claim input VAT.
“VAT paid on fuel should be claimed as input VAT. Businesses should also choose suppliers who are VAT-registered to ensure they can claim it later. To protect that chain, we must encourage taxpayers to register for VAT to avoid affecting final prices,” he said.
Energy supply equipment listed by the responsible minister is exempt until 30 June 2028. Similarly, industrial machinery, capital assets, and raw materials used in industries are exempt until 30 June 2026. Imported pure electric motor vehicles, relevant batteries, and charging equipment are exempt until 30 June 2028.
A new 0.2% environmental levy applies to imported items packaged in plastic, calculated based on their customs value.
On the other hand, the Excise Duty Law has extended the tax period from 10 days to a full calendar month. Other changes include a new rate of 40% on beer made with at least 70% local raw materials (excluding water), 65% on other beers, and a 36% tax on cigarettes applied to the retail price (including tax), plus Frw 230 per pack of 20 rods.
Regarding the Income tax, new provisions include a 10% capital gains tax, a 40% tax on companies engaged in gaming activities (excluding the national lottery), 25% withholding tax on the difference between a player’s winnings and the amount wagered, and a 1.5% digital tax on companies supplying digital services with a substantial presence in Rwanda.
A separate law introduces a 3% tourism tax on accommodation—defined as any service providing a room or place to sleep or rest.
Emmy Mbera, Assistant Commissioner in charge of the Tax Control and Operational Support Division at RRA, said the tax administration is working with local government officials and security agencies to ensure that all tourism service providers are registered.
“To compute this tax, the law states that anyone offering accommodation services must register for tourism tax, just like other taxes. In the EBM system, we will list rooms and related services. When a taxpayer selects this category and issues an invoice, the EBM will automatically calculate VAT, tourism tax, etc. When we print the invoice, it will clearly show the tourism tax,” he said.
Another new tax is the levy on petrol, gas oil and motor vehicles for road maintenance.
Mbera encouraged members of the Institute of Certified Public Accountants of Rwanda (ICPAR) and the Association of Tax Advisors of Rwanda (ATAR) to review the new regulations carefully, raise any concerns, and help their clients comply.
If fully implemented, the new tax measures are expected to generate Frw174.1 billion in the FY 2025/26 and Frw353.0 billion by the FY 2029/30.
Click below to read all the laws gazetted on 29/05/2025 and any other laws of interest to you.
https://www.rra.gov.rw/en/laws-policies-and-rulings