Understanding Rwanda's New Environmental Levy on Imported Items Packaged in Plastic Materials

Background to the Environmental Levy

The concept of an environmental levy on imported goods packaged in plastic materials is not entirely new in Rwanda. It was initially introduced by Law n° 17/2019 of 10/08/2019 relating to the prohibition of manufacturing, importation, use and sale of plastic carry bags and single-use plastic items (the "Plasban Act"). Article 5 of Plasban Act subjects imported goods packaged in plastic materials to environmental levy in accordance with relevant laws. However, a critical gap existed, Plasban Act did not provide the necessary modalities for the administration of this environmental levy.

Recognising this administrative gap, the need arose for a specific legal framework to detail how this environmental levy would be applied. The New Environmental Levy Act has been promulgated with the explicit purpose of regulating the rate and base, modalities for its collection and management, and establishing a list of imported items subject to the environmental levy. This New Environmental Levy Act also aims to create a balance and favorable competition between imported and domestically produced goods packaged in plastic material, while supporting medium-term domestic resource mobilisation for national development plans (National Strategy for Transformation (NST2)).

Key Provisions and New Changes in the New Environmental Levy Act

The New Environmental Levy Act provides the specifics that were missing from the Plasban Act, clearly outlining how environmental levy will operate. The New Environmental Levy Act defines the "levy" as a charge applied to imported items packaged in plastic materials, aiming at the management of the resulting waste. "Items" are defined broadly as tangible or intangible property packaged in plastic materials, and "plastic materials" include lightweight, soft, non-compostable materials, such as plastic carry bags, derived from petrochemicals.

"The New Environmental Levy Act provides a comprehensive framework for implementing the environmental levy, filling the administrative gap that existed under the previous Plasban Act while supporting Rwanda's commitment to sustainable development and environmental protection."

Scope and Exceptions

Article 3 of the New Environmental Levy Act provides that environmental levy applies to a list of imported items included in an annex, with specific exceptions. The exceptions are for imported items of single use exempted in accordance with the East African Community Customs Management Act (EACCMA), and pharmaceutical products. Particularly, the New Environmental Levy Act includes a provision allowing the Minister of Finance and Economic Planning (MINICOFIN) to expand or narrow down the list of items subject to the environmental levy via a Ministerial Order (Article 3(2) of New Environmental Levy Act).

Examples of items included in the initial list provided in the annex to the New Environmental Levy Act are:

• Water
• All types of juice
• Energy drinks
• Carbonated non-alcoholic beverages
• Clothes
• Shoes
• All types of soap
• Toilet papers

Feature	Details
Levy Rate	0.2% of customs value
Collection Point	Customs, per EACCMA
Effective Date	July 1, 2025
Key Exemptions	Pharmaceuticals, some single-use items
Revenue Destination	Treasury Single Account (sub-account)

Levy Rate and Collection

A key detail provided by the New Environmental Levy Act is the rate of the levy. Imported items subject to this New Environmental Levy Act will be subject to an environmental levy of 0.2% calculated on their customs value.

Regarding the administrative modalities, the New Environmental Levy Act clearly states that the levy on imported items packaged in plastic material is collected at the customs point in accordance with the East African Community Customs Management Act. The collected levy is then to be deposited into a sub-account of the Treasury Single Account.

Implications for Businesses

With New Environmental Levy Act taking effect on July 1st, 2025, it is important for all parties involved in importing goods into Rwanda to become familiar with New Environmental Levy Act provisions. Importers of items packaged in plastic materials must understand whether their goods are included in the annexed list and not covered by the specified exemptions.

Businesses should also stay informed about any potential Ministerial Orders that may modify the list of items subject to the environmental levy.

While the 0.2% levy may seem modest, it represents another step in Rwanda's comprehensive approach to environmental protection and waste management. For businesses regularly importing large quantities of goods packaged in plastic materials, the cumulative effect of this levy could be significant and should be factored into pricing and operational strategies.