1.10. ORGANIZATION OF THE STUDY
This study was divided into five chapters: Chapter one is
general introduction and it is composed by the background of the study,
Statement of the problem, Research hypothesis, Objectives of the study,
Rationale of the study, and the Scope of the study, crucial definition of
taxation and finally organization of this study.
Chapter two presents the literature in relation to the topic
under study, this chapter deals with the historical background of taxation in
general and Rwanda context, Conceptual framework, Theoretical framework and
studies related to this study.
Chapter three briefly highlights the various research methods,
simply this chapter indicates Data Collection, Sources of Data, Data Collection
Procedure, Data Processing and Data analysis. Chapter four presents data
analysis and interpretation of the results. It shows the index of data analysis
in a scientific way using software and various tools such as tables, graphs,
charts, etc.
Chapter five revealed summary of findings, conclusion and
recommendations. In this study, researcher will combine, both qualitative and
quantitative, so as to gain an insightful analysis of the relevant facts and
figures in explaining impact of tax revenue on economic growth in Rwanda.
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CHAPTER- 2 LITERATURE REVIEW 2.1 INTRODUCTION
The study observes the ideas or views of various authors who
took keen interest in the subject matter. Basically, the review was done on the
following sub-headings of historical background, conceptual framework,
theoretical framework, related case studies and summary of the literature
reviewed.
2.2 HISTORICAL BACKGROUND OF TAXATION IN GENERAL AND
RWANDA
CONTEXT
Taxation is said to have come into existence «from time
immemorial» without a specific mention of when exactly it evolved.
However, the origin of tax levies can be traced to the ancient cities of Greek
and Rome in modern literature; but from the Bible account, it has been as old
as the world. In these so called cities of Greek and Rome, taxes were levied on
consumption, saving, investment and properties (Abomaye-Nimenibo, 2017). From
the account of St. Mark's gospel (chapter 12:14-16), a disciple of Jesus Christ
precisely St. Peter was reported in the Holy Bible was confronted by the tax
authorities and he met Jesus Christ who commanded him to get money with which
Peter paid for himselve and the Lord Jesus Christ. St. Mathewgospel chapter
17:24-27 of the Holy Bible, stated that our Lord Jesus Christ Himself paid tax.
Furthermore, in Matthew 19:21 we see tax money having its functions to perform
in the society which enables government authorities to use in providing social
services that will be enjoyed by all the citizens of a country. Such social
services include the provision of health and education, maintenance of law and
order, provision of basic amenities and infrastructures etc. Tax payment is
therefore part of the price to be paid by sound members of an organized and
orderly society
In Rwanda, The history of taxation in Rwanda indicates that
the first tax legislation was inherited from colonial regimes. This tax
legislation included the Ordinance of August 1912, which established graduated
tax and tax on real property. There was another Ordinance on 15thNovember 1925
adopting and putting into application the order issued in Belgian Congo on
1stJune 1925, establishing a profits tax. This law was amended by law of 2nd
June 1964 establishing Direct tax on profit. A substantive law governing
customs was ratified on 17th July 1968 accompanying the Ministerial Order of
27th July 1968, putting into application the
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Customs Law. This law was amended from time to time in order
to comply with the changing economic environment. Such other legislative
instruments include the 1973 law governing property tax, the tax on license to
carry out trade and professional activities, the Law No. 29/91 of 28th June
1991 on sales tax (turnover tax) now repealed and replaced by the Law No.
06//2001 of 20/01/2001 on the Code of Value Added Tax (VAT). In 2005, the
parliament adopted law number No25/2005 of 04/12/2005 on tax procedures,
amending Decree-Law of December 28, 1973 relating to Personal Tax, Law No
06/2001 of January 20, 2001 on the Code of Value Added Tax and Law No 9/97 of
June 26, 1997 on the Code of Fiscal Procedures. Similarly, Law No 16/2005 OF
18/08/2005 2005 on direct taxes on income was adopted replacing Law No 8/97 of
26/6/1997 on Code of Direct Taxes on Different Profits and Professional Income,
and Law No 14/98 of December 18, 1998 establishing the Rwanda Investment
Promotion Agency, especially in its Articles 30, 31 and 34.
The parliament also adopted Law No. 21 of 18/04/2006
establishing the customs law, replacing the Law of July 17th 1968 concerning
the Customs law as amended and completed to date. However, on July 1, 2009,
Rwanda adopted the EAC Customs Management Act 2004, An Act of the Community to
make provisions for the management and administration of Customs and for
related matters
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