The government of Rwanda has announced an increase in gambling taxation to support the country’s national revenue and promote responsible gambling activities. From the financial year 2024/2025, the tax on Gross Gambling Revenue (GGR) will rise from 13 percent to 40 percent, while the withholding tax on winnings will increase from 15 percent to 25 percent. This policy shift is part of a broader economic transformation plan to reinforce Rwanda’s financial self-sufficiency.

Motives driving the tax increase

The Ministry of Finance and Economic Planning (MINECOFIN) has emphasised that these tax hikes align with Rwanda’s long-term economic growth strategy. The increased tax revenue will support Rwanda’s Second National Strategy for Transformation (NST2), which aims to enhance infrastructure, improve education and healthcare, create jobs, and diversify the economy.

Higher taxes serve as a deterrent to reckless gambling, particularly among young people. The government aims to balance economic benefits with social responsibility.

A 15 percent excise duty has been imposed on imported cosmetics and beauty products, while car registration fees have increased, generating additional tax revenue. Value added tax (VAT), previously exempted on mobile phones and ICT devices, has been reinstated, and the fuel levy is now set at 15 percent of the cost-insurance-freight (CIF) value instead of a fixed amount.

Government’s official statement on changes

The Ministry of Finance and Economic Planning reaffirmed its commitment to economic stability.

A Ministry of Finance and Economic Planning statement said, “As we continue to build a robust economy and transform the livelihoods of all citizens, the reform of the gambling tax regime is a pivotal part of our medium-term strategy. These measures strengthen our resilience and promote self-reliance, allowing us to meet our development goals effectively.”

Impact on the gambling sector

Operators of casinos and sportsbooks in Rwanda will experience a significant increase in tax burdens, which may affect their profitability. Industry experts warn that the high increase may lead to decreased investment in gambling, possible shutdowns of small firms, and increased fear of job loss among the more than 5,000 employees in the industry.

Between 2013 and 2019, Rwanda’s gambling industry generated a gross revenue of 264.3 billion RWF (approximately $182.9 million), paid 8.8 billion RWF (approximately $6.1 million) in taxes, contributed 623.2 million RWF (approximately $431,254.40) to the Rwanda Social Security Board (RSSB), and supported local businesses through employee spending.

The Rwanda Development Board (RDB) has introduced a new gambling policy focused on stronger oversight of gambling businesses, mitigating gambling addiction, and cracking down on illegal gambling operations.

The government will monitor industry trends and may adjust policies to ensure tax revenues increase without stifling sector growth. Continuous stakeholder engagement and regulatory flexibility will be crucial to balancing revenue generation and sustainable industry operations.