Rwanda’s New VAT Model on Petroleum Products: What Public Institutions & Businesses Need to Know

On 27 May 2025, the Government of Rwanda enacted Law N° 009/2025, amending Law N° 049/2023 on Value Added Tax (VAT). One of the major shifts relates to how VAT is managed on petroleum products.

This change was reinforced through a communiqué to all public institutions and supported by the Rwanda Utilities Regulatory Authority (RURA) public notice of 15 July 2025, which announced VAT-inclusive fuel prices effective 2 July 2025.

This reform fundamentally reshapes how VAT is accounted for in the fuel sector and significantly affects both public institutions and petroleum dealers.

Key Features of the New VAT Model

Fuel Prices Now VAT-Inclusive

  • Fuel prices published by RURA now already include VAT.
  • This ensures price transparency for consumers and standardization across all service stations.

VAT Collected at Customs

  • The full VAT output on petroleum products is now collected by the Rwanda Revenue Authority (RRA) at customs when fuel is imported.
  • This reduces administrative complexity for downstream dealers.

No VAT Withholding by Public Institutions

  • Public/government institutions are instructed to stop withholding VAT when purchasing petroleum products.
  • This prevents double taxation since suppliers already fulfill their VAT obligations at customs.

Simplified Business Accounting for Dealers

  • Petroleum companies no longer have to request VAT refunds, which historically delayed cash flow.
  • The system reduces refund exposure and streamlines compliance.

Reduced Risk of Double Taxation

  • Under the old model, VAT withholding by public institutions risked over-taxing suppliers.
  • The new model ensures fairness and consistency across the supply chain.

Implications for Stakeholders

Public Institutions

  • Must immediately stop withholding VAT on fuel purchases.

  • Internal accounting and payment systems should be updated to reflect this change.

  • Failure to comply could create reconciliation issues with suppliers and RRA.

Petroleum Dealers & Fuel Stations

  • Cash flow improves since refund claims are eliminated.

  • Accounting processes become simpler, with VAT compliance centralized at customs.

  • Dealers must ensure that input VAT records match the new model.

Businesses & Consumers

  • Businesses that consume petroleum products (e.g., logistics firms) no longer face complicated VAT refund processes.

  • Consumers benefit from stable VAT-inclusive pump prices, set by RURA.

Why This Reform Matters

This reform is more than a procedural change—it reflects Rwanda’s broader tax modernization strategy:

    • Simplifying compliance for businesses
    • Reducing administrative bottlenecks in VAT refunds
    • Improving government revenue efficiency by centralizing VAT collection


    It is also a clear example of how law (Law N° 009/2025), regulatory notices (RURA), and tax administration (RRA) work together to streamline compliance.

How ALSM Ltd Can Help You Adapt

At ALSM Ltd (formerly ALCPA), we support both public institutions and private businesses in understanding and adapting to tax reforms like this one.

Our support includes:

  • Tax Advisory & Compliance – Clear guidance on VAT, PAYE, CIT, Excise Duty, and the latest reforms.

  • Accounting & Bookkeeping – Accurate accounting of fuel purchases, VAT-inclusive transactions, and compliance with new rules.

  • Audit & Assurance – Independent audits to ensure compliance with the amended VAT framework.

  • Outsourced CFO Services – Strategic oversight of how reforms affect financial planning, pricing, and reporting.

  • Corporate Secretarial Support – Assistance with RRA filings, RDB annual returns, and statutory compliance.

  • Financial Training – Workshops to help staff understand VAT reforms and practical application in accounting systems.

    • Sunny MATETI

    Managing Partner


    Chartered Accountant and Certified Public Accountant, I excel in managing intricate tasks, adhering to strict deadlines, and providing outstanding results. My expertise is grounded in a solid 17+ years of experience in auditing, accounting, tax, and advisory services.

    Stay Compliant. Stay Competitive.


    Don’t let regulations slow down your hospitality business. ALSM Ltd is your trusted partner in Rwanda’s evolving tax landscape.

    Phone: +250 784 441 144
    Website: www.alsm.ltd