Rwanda has finally started piloting the much awaited electronic cargo tracking system to seal loopholes some unscrupulous taxpayers use to evade paying taxes.

Cargo is declared as in transit to Democratic Republic of Congo, Burundi, Tanzania and Uganda but ends up being dumped in Rwanda creating unlevelled business environment.

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Some traders complain that their peers who do not pay taxes offer lower prices to their disadvantage.

The Rwanda Revenue Authority (RRA) has as a result suffered a shortfall in tax collection.

The taxman’s targets during the first quarter running from July to October 2013, collected Rwf237.9 billion against a target of Rwf243.5 billion.

A tax analyst said the electronic cargo tracking system will reduce revenue losses that accrue from diversion of transit goods.

“We have opted for the Common Market for East and Southern Africa (Comesa) electronic cargo tracking system,” said Richard Tusabe, Commissioner General of RRA.

“The Comesa electronic cargo tracking system is free,” Mr Tusabe said, explaining that other East African Community states had to part with $2 million to install their systems.

The ultimate aim of the project is to create a level playing field for businesses not only in Rwanda but in countries that share the northern corridor, said Mr Tushabe.

The project, which started in the first quarter of this year targets 200 trucks registered in Rwanda.

Analysts say upgrading cargo handling processes and timely delivery of goods creates a level playing field for the businesses.