Rwanda's proposed EBM exemption for turnover under Rwf 2 million
A proposed ministerial order would exempt businesses with turnover under Rwf 2 million from Electronic Billing Machines. What is proposed and what applies.
In July 2026 The New Times reported that Rwanda's Cabinet had approved a package of tax reforms that includes a proposed ministerial order exempting businesses and individuals with annual turnover below Rwf 2 million from the requirement to use Electronic Billing Machines. The Director General for Tax Policy at the Ministry of Finance and Economic Planning said alternative measures would be explored to ensure transactions are properly recorded where EBMs are not applicable. The Rwanda Revenue Authority said the framework needed updating after thirteen years in use. As at the time of writing the order is proposed, not yet in force.
What applies today
Until the order is published, RRA's position stands: every person carrying out taxable activities, VAT registered or not, must issue an EBM invoice on every sale. The legal basis is Law 020/2023 of 31 March 2023 on tax procedures and the ministerial orders of 2013 and 2016 on the modalities of using a certified EBM. The penalties are heavy. Failing EBM obligations attracts an administrative fine of Rwf 200,000, rising to Rwf 400,000 if repeated within two years; a VAT-registered seller who sells without an invoice faces ten times the evaded VAT, twenty times for repeat offenders; and further sanctions can include a thirty-day closure, exclusion from public tenders and publication in the national press.
The options RRA already offers small taxpayers
RRA lists several EBM systems, so "machine" is a loose word. EBM version 2.1 for Android is for non-VAT registered taxpayers and newly registered micro and small taxpayers, and runs on a phone. An online, web-based EBM serves service-sector taxpayers who issue no more than ten invoices a month, with no device at all. EBM 2.1 for Windows runs on a computer or tablet, and the Virtual Sales Data Controller lets a business integrate its own invoicing system. Since May 2023, buyers purchasing for resale also need a Purchase Code from MyRRA or *800# before the seller can generate the invoice.
Why the exemption is not an exit from the tax system
A tax partner quoted in the same article made the point plainly: exempting small firms from EBMs does not take them out of the tax net. Their sales can still be tracked through digital channels, including platforms linked to electronic payments such as mobile money. He also noted that enforcing EBM rules on very low-revenue traders can cost the government more than the tax collected, which is the logic behind the proposal. The package also includes a buyer-initiated invoice: where a seller fails or delays to issue one, the buyer can start it and the seller confirms.
The consumer side keeps the pressure on
Since 2024 RRA has run a VAT reward scheme: a registered consumer gets back 10 percent of the VAT shown on each EBM invoice they receive, and 50 percent of any penalty levied on a seller who refuses to issue an invoice or issues an inaccurate one. Consumers register by dialling *800#. An exemption for the smallest sellers does not change the behaviour of customers who have been taught to ask for the invoice and to put their phone number on it.
What a small Rwandan business should do now
- Work out which side of Rwf 2 million you are on, honestly. Annual turnover is total sales, not profit.
- Keep issuing EBM invoices until the order is gazetted. A proposal is not a defence against a Rwf 200,000 fine.
- Record every sale regardless. Whatever the "alternative measures" turn out to be, they will rely on sales records that already exist, and so will your own decisions about stock and price.
- If you are growing toward the threshold, choose the EBM option that fits (Android app, online EBM or an integrated system) rather than waiting to be forced onto one.
The regional pattern
Rwanda is adjusting the lower edge of a system it built early; Uganda and Kenya are widening theirs. In every case the authority is moving from "do you have the machine" to "can we see the sale". Businesses that treat their sales record as their own asset rather than as paperwork for the state are the ones that find these changes easy.
Sources
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