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June 26, 2020
Rwanda presents National Budget for financial year 2020/2021
The Rwanda National Budget, whose theme is “Stimulating the economy to safeguard livelihoods, jobs, businesses and industrial recovery,” was presented by the Minister of Finance and Economic Planning on 22 June 2020.
The focus of the national budget is economic recovery from the COVID-19 pandemic as well as safeguarding lives, jobs, business and industrial recovery.
Due to the COVID-19 pandemic, the economy is expected to only register growth of 2% in 2020, a sharp decline from the growth of 9.4% registered in 2019. The economic growth is expected to rebound to 6.3% in 2021 and 8% in 2022.
Financing of the budget:
Key expenditure priorities in line with NST-1 and resources allocation
The allocation of resources in the national budget were guided by the strategic objectives of the National Strategy for Transformation (NST). The NST is Rwanda’s long-term plan to achieve the middle-income status by 2050.
NST-1 has three-pillars namely:
a) Economic transformation – to accelerate inclusive economic growth and development founded on the private sector, knowledge-based economy and Rwanda’s natural resources.
b) Social transformation – to develop the Rwandans into a capable and skilled work force with quality standards of living and a stable and secure society.
c) Transformational governance – to consolidate good governance and justice as building blocks for equitable and sustainable national development.
Budgetary allocation under NST-1 pillar:
In line with NST-1, the key priorities under the National Budget are:
The Minister of Finance and Economic Planning did not propose any changes to the current taxation system.
For additional information with respect to this Alert, please contact the following:
Ernst & Young Rwanda Limited, Kigali
Ernst & Young (Kenya), Nairobi
Ernst & Young Advisory Services (Pty) Ltd., Africa ITTS Leader, Johannesburg
Ernst & Young Société d’Avocats, Pan African Tax – Transfer Pricing Desk, Paris
Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London
Ernst & Young LLP (United States), Pan African Tax Desk, New York