KIGALI, Rwanda — The mobile telecommunications sector in Rwanda is calling on the government to reform what it describes as a “highly complex and burdensome” tax environment,
They argue that the current fiscal framework hinders investment in infrastructure, limits network expansion, reduces service quality, and slows digital inclusion and broader socioeconomic development.
The appeal, outlined in a policy brief prepared by the GSMA, a global organization representing the mobile ecosystem, comes as the sector faces a disproportionately high fiscal burden compared to other key industries.
According to the brief, mobile operators in Rwanda pay over 30 separate taxes, fees, and levies, including corporate income tax, value-added tax, an excise duty on mobile services, customs duties, employment taxes, and numerous regulatory fees.
The excise duty on mobile services is set to increase from 12% in June 2025 to 14% in June 2026 and 15% in June 2027. The brief argues that eliminating this sector-specific tax would enhance affordability, especially for lower-income populations, and support wider adoption of mobile connectivity.
The average effective tax rate for the mobile sector is 74% of pre-tax profits, significantly above the 34% paid by the retail finance sector and the 29% paid by the agro-processing sector, the brief found. As a share of revenue, mobile operators pay 12%, compared to 10% for both retail finance and agro-processing.
Revenue-based fees, including a 2% Universal Service Fund levy on gross revenue and spectrum fees, absorb 37% of pre-tax profits, the brief noted. These charges are imposed directly on revenues or as fixed fees, significantly reducing operators’ free cash flow, which the brief describes as the primary and, in some cases, the only source of funding for infrastructure investment and network upgrades.
The brief emphasizes that revenue-based fees result in a “structurally rigid and more regressive tax system” that is less aligned with actual profitability and less responsive to investment cycles in a capital-intensive sector.
The financial performance of the country’s two dominant mobile network operators presents a mixed picture.
MTN Rwandacell PLC, which is majority-owned by the South African group, achieved a major financial turnaround in 2025, recording a Profit After Tax of Rwf 10.8 billion. This represents an earnings recovery of over 300% year-on-year, bouncing back strongly from a restated net loss of Rwf 5.37 billion in 2024.
In contrast, Airtel Rwanda, owned by India’s Bharti Airtel, did not record a net profit in the 2025 financial year, posting a net loss of Rwf 78,981 million for the year ended March 31, 2025. The company’s total liabilities exceeded its total assets at the end of the period, contributing to an accumulated loss of over Rwf 566 billion.
While MTN and Airtel are the primary mobile network operators, the broader telecommunications sector also includes other companies that provide services like internet access and network infrastructure, including KT Rwanda Networks and various internet service providers.
The GSMA is proposing three key reforms.
First, it recommends shifting toward a broad-based tax framework by minimizing or eliminating sector-specific, revenue-based fees to ensure the mobile sector is treated more equitably compared to other sectors.
Second, it calls for the removal of the excise duty on mobile services.
Third, it urges the government to streamline the mobile tax structure by reducing the number of overlapping levies and fees to lower compliance costs and create a more predictable and efficient fiscal environment to support long-term investment.
The tax analysis, provided by Ernst and Young LLP, was based on information available in 2025 and modeled a hypothetical representative firm over a 15-year period.
