Rwanda Law n° 014/2025 — Income Tax Amendment: Capital Gains Tax on Mining Licence Transfers doubled to 10%

Mechanism

Law n° 014/2025 amends Law n° 027/2022 (Rwanda's income tax statute) by adjusting the CGT rate applicable to capital gains on the disposal of "securities" — a term the amendment explicitly broadens to include mining licences, quarry licences, debt instruments, options, guarantees, and similar assets in addition to ordinary share transfers. The operative CGT rate increases from 5% to 10% of the realised capital gain, calculated as proceeds minus the cost base (original acquisition price plus allowed improvements).

Under prior law, CGT applied primarily to gains on equity/share transfers. Direct transfers of a mining or quarry licence between parties — common in the 3TG artisanal-to-formal formalisation pipeline and in junior mining M&A — were taxed under alternative frameworks (corporate income tax at 28%, plus 18% VAT on the transfer value itself). The 2025 amendment layers an explicit 10% CGT on top of those mechanisms where a gain is realised, increasing the composite tax friction on licence exit events.

Downstream implications

• Licence flipping disincentive: The incremental 5pp CGT increase raises total transaction cost for short-cycle licence acquisitions aimed at resale; junior explorers will need higher exit multiples to clear the combined CGT + CIT + VAT burden.
• Affects formal sector primary operators: Key formal-sector companies with licence-holding positions — LuNa Smelter Ltd (tin), Nyabarongo Mining & Exploration / Rio Tinto (tin/tantalum/gold) — now face a higher statutory charge on any licence-level M&A or portfolio rebalancing. Rio Tinto's 2024–2025 country-entry positioning in Rwanda is directly affected.
• 3TG traceability supply chain: Rwanda processes ~30–40% of the world's conflict-mineral-certified cassiterite (tin) and coltan (tantalite); CGT escalation may slow consolidation of artisanal mine blocks into larger licensed units, with potential knock-on effects for OECD/EU OECD Due Diligence Guidance compliance chains.
• Complements Law 072/2024: Rwanda's 2024 Mining Law (Law n° 072/2024) introduced investment-commitment thresholds before a licence transfer is legally permissible. Law 014/2025 adds the fiscal layer — together, the two statutes create a three-barrier exit framework: (i) investment threshold (regulatory), (ii) 10% CGT on gain (fiscal), (iii) 18% VAT on transaction value (fiscal). This significantly raises the cost and complexity of licence-level divestiture relative to peer African jurisdictions.
• Portfolio implication: Rwanda's mineral-policy posture is moving toward active retention of operating investment rather than pass-through of licences to upstream consolidators — consistent with the broader East African beneficiation-first legislative wave (Tanzania Mining Act 2017, DRC ARECOMS, Zimbabwe lithium ban).

Open questions

• Whether subsequent Ministerial Instructions clarify the CGT cost-base calculation for licences acquired under concession agreements rather than outright purchase (cost-basis ambiguity in the statute).
• Whether the 1 July 2025 deferred-entry provisions cover specific sub-categories of the expanded securities definition or specific payer classes.
• Rio Tinto's response to the CGT escalation given its recently acquired Rwandan exploration portfolio — no public statement as of June 2026.