Rwanda Revenue Authority (RRA) registered a tax collection shortfall in the first six months of 2016/17 fiscal year.

RRA missed its tax revenue target by about $3 million. It also missed its non-tax revenue target.

The taxman’s target for the July-December period was Rwf534.3 billion ($650.2 million), but only Rwf531.6 billion ($646.8 million) was collected.

According to RRA Commissioner-General Richard Tusabe, revenue collection improved in November and December averaging about Rwf101.5 billion ($123.4 million) monthly, boosted by festive season shopping as businesses rushed to restock.

However, between July and October, tax collected averaged Rwf82.1 billion monthly, which saw the RRA lose over $800,000 in taxes as a result of manipulation of the electronic billing machines by unscrupulous businesspersons.

But, Mr Tusabe is hopeful that revenue collection will improve after RRA roped in new taxpayers and has also set up new enforcement measures to curb tax leakages.

The country has been grappling with low tax compliance levels, a slowdown in the economy occasioned by reduced spending by both government and private sector, and depreciating Rwandan franc against the dollar.

RRA says it has introduced an input validation system set to increase VAT collections whilst eliminating fictitious tax declarations and refund claims.

Rwanda is also pinning its hope in boosting revenue collection when the electronic cargo tracking system, which is still under test, is officially commissioned. The system helps seal revenue loss loopholes as a result of under-declaration of the value of exports and imports as well as curbing the theft of cargo.