A Critical Analysis of Effectiveness of Tax Offences Control Mechanisms Under Rwandan Law

III.1.10 Introducing record keeping and accounting codes

Poor recording keeping is one of the key barrier that RRA meets when reviewing or auditing businesses.

The law or regulations should specify taxpayers' obligations to keep books of account and other records necessary for determining tax liability. These would include the content and form of invoices, what taxpayers must use them, and under what circumstances.

The tax administration should compel businesses to keep better records by providing assistance and information on record keeping; providing recording keeping tools; and/or by using the law to make certain reporting, record keeping or accounting standards mandatory.

III.1.11 Taxpayer assistance and education

Assisting taxpayers by improving the flow and quality of information or educating them into becoming more responsible citizens (eg TV campaigns) might yield greater revenue rather than if it were spent on enforcement activities. Some Anglo-Saxon revenue authorities support taxpayers through a range of easily accessible explanatory leaflets and provide a useful site on the Internet^85(*).

Tax administration should recognise that the traditional tax infrastructure of law, auditors, penalties, debt collectors and court cases needs to be supplemented by measures to boost taxpayers' commitment to pay tax and their trust in the tax administration.

The tax administration should use different measures to assist and educate taxpayers, such as providing information and tools to help taxpayers comply; providing rewards and incentives for good compliance; and involving taxpayers in consultative forums. At the same time, taxpayers will also help the tax administration by acting as informants and establishing good taxpayer behavioural norms.

In 2007, taxpayers' education continued especially on the new tax and customs laws with a view to enhance taxpayers' compliance. Several seminars, workshops and consultative meetings with taxpayers, both small and large were organised in all provinces and Kigali City. Also three seminar sessions on new fiscal laws with lawyers were organized in collaboration with the Supreme Court. Sixty meetings at district level were also organised through Tax Advisory Councils^86(*).

RRA has taken ground breaking initiatives to sensitise the business community on Value Added Tax (VAT) collection. Some taxpayers are not informed about the law while others lack financial accounting skills and end up committing mistakes unintentionally. In this regard, VAT campaigns were organised in different venues of Kigali City. RRA has come closer to help taxpayers understand the law and train them to handle financial accounting matters so as to avoid fines. Also RRA wanted to hear the concerns of taxpayers to enable it tailor make solutions.

During the year 2007, RRA continued to give relevant information to taxpayers to enable them comply with their tax obligations. In this regard, the design and content of the RRA's website was upgraded to provide easily more comprehensive and targeted information to our customers.

* ⁸⁵ Ken Devos, Penalties and Sanctions for Taxation offences in Selected Anglo-Saxon Countries: Implications for Taxpayer compliance and Tax policy,

* ⁸⁶ RRA Annual Report for 2007, March 2008