Tax revenue exceeded the government’s target during the 2025/26 fiscal year, driven by stronger economic growth, improved voluntary tax compliance and new tax measures, the Rwanda Revenue Authority (RRA) said Wednesday.
The tax authority collected Rwf3.956 trillion, surpassing its target of Rwf3.795 trillion by 4% and recording a 27.7% increase compared with the previous fiscal year.
RRA Commissioner General Ronald Niwenshuti attributed the performance to stronger economic activity and increased voluntary tax compliance.
“Taxpayers have increasingly embraced voluntary tax compliance,” Niwenshuti said during a news conference, adding that the economy expanded by about 11% across the four quarters of the fiscal year, broadening the country’s tax base and boosting tax collections.
Taxes transferred to local government entities reached Rwf137.9 billion, exceeding the annual target by 2.4%.
The RRA also registered 126,282 new taxpayers, who contributed nearly Rwf15 billion in revenue, while the authority recovered Rwf277 billion in outstanding tax arrears.
Growth in tax receipts was supported by increased business activity across several sectors. The value of commercial transactions rose by 23.7%, while VAT-taxable sales increased by 59.2%. Taxable corporate profits grew by 22.9%, contributing to higher corporate income tax collections, while Pay-As-You-Earn (PAYE) tax revenue increased by 16%. Taxable imports processed through customs also rose by 29.6%.
According to the RRA, recently introduced tax measures also generated more revenue than expected. The reforms were projected to raise Rwf259.2 billion, but collections reached Rwf286.7 billion, equivalent to 110% of the target.
For the 2026/27 fiscal year, the authority has set a domestic tax revenue target of Rwf4.64 trillion, while taxes earmarked for local governments are projected to reach Rwf165.9 billion.
If achieved, domestic tax revenue will finance 61.6% of the national budget, reflecting the government’s continued efforts to strengthen domestic resource mobilization.
To meet the new target, the RRA said it will focus on expanding taxpayer registration, improving timely tax filing and payment, and promoting accurate tax declarations. Compliance efforts will prioritize the manufacturing, transport and logistics, information and communication technology, education, construction and tourism sectors.
The authority also plans to strengthen customs enforcement by targeting high-risk imports, expand the use of Electronic Billing Machines (EBMs), and encourage consumers to continue requesting EBM receipts to help curb tax evasion.
