Small and micro businesses have been given 15 extra days to file and pay Quarterly Income Tax.
Rwanda Revenue Authority (RRA) said the extention of the period for filing and paying the Tax Prepayment to mid July, which should have ended on June 30, is to allow them cope with the new online system.
The Comissioner General of RRA, Pascal Bizimana Ruganintwali told Taarifa on Wednesday morning that with the new formula of calculating the quarterly Income tax prepayment based on the real turnover made in the first quarter( January-March 2020), many small and micro taxpayers may not be able to apply it easly.
“We think they need time to comply without penalties,” he said. “Also as we request them to go for online services to avoid spread of Covid-19 (they used to come at RRA for support), we think it is proper to give them time and get RRA support remotely where needed by taxpayers.”
RRA expect to collect revenues, he added, “but also avoid penalizing them for late filing and payment of their income tax. To their side we expect raising compliance in filing and paying their taxes.”
Thousands of these small and micro businesses still operate informally, and RRA is trying to create and ecosystem that introduces them into the the formal world, but also allow them to grow and generate more revenues.
There are pproximately 33,000 taxpayers and if they comply, RRA could raise at least Rwf1.6 billion.
However, their contribution to the general tax account is still small, and RRA believes if they begin operating formally, the out come might be different.
Since most of them are still learning how to comply with the use of the new system, “We better facilitate them than wait for them to fail and penalize them,” the Commissioner General said.