Citizenship-based taxation: if weddings can be taxed, why not wealth abroad?

2025-09-28 08:36:00   |   Yedidia Kamanzi

All over the internet and increasingly in legal and policy circles, one debate keeps coming up:

Should countries tax their citizens on income earned abroad?

This model, called Citizenship-Based Taxation (CBT), has triggered global discussions, especially after its success (and controversy) in countries like the United States. CBT means that even if a citizen lives outside the country, they still file and possibly pay taxes back home, based on their worldwide income.

Now here’s why we believe Rwanda and perhaps Africa at large should join this conversation:

Recently, the government has proposed taxing certain wedding activities to increase national revenue.

This shows a clear trend: the country is looking for creative and practical ways to broaden the tax base.

If private events like weddings are considered potential revenue sources, then why not also consider high-income Rwandans living abroad many of whom contribute nothing to the tax system despite their continued use of our identity, reputation, and benefits?

The Logic Behind CBT: Shared Identity, Shared Responsibility

CBT is based on a powerful but simple idea:

Being Rwandan doesn’t end at the airport gate.

Even while living abroad, a citizen still:

• Uses their Rwandan passport
• Relies on the Rwandan diplomatic services
• Maintains ties to local businesses and families
• Builds wealth partly thanks to the foundation this country gave them

So, why should that person be exempt from contributing, while a local shopkeeper or farmer pays their fair share?

No, CBT Isn’t About Punishment

Critics argue that CBT causes double taxation or is too complex. But if designed correctly, that’s not true.

Many of these issues can be addressed through:

• Foreign tax credits
• Minimum income thresholds (to exclude low-earning citizens abroad)
• Simplified digital reporting tools
• Clear tax treaties between countries

CBT doesn’t have to burden the average diaspora citizen targets fairness and inclusion, especially for high-net-worth individuals.

Weddings vs. Wealth: What’s Really Fair?

Let’s be honest:

If we’re discussing revenue from weddings, an emotional, often one-time personal event, shouldn’t we also be asking why millions of francs earned abroad by Rwandan citizens go completely untaxed?

One is a private celebration. The other is a steady, recurring income earned by people who continue to benefit from their Rwandan citizenship.

It’s not just about fairness. It’s about logic.

What We Propose

At our firm, where we focus on tax law and business law, we’re not saying Rwanda should copy-paste the U.S. system.

We’re saying: Let’s think forward. Let’s create a made-in-Rwanda version.

We propose:

• A policy think-tank to study CBT in the Rwandan context
• A diaspora tax registry for high-income earners abroad
• Legal consultations with stakeholders across the government and private sectors
• A CBT framework that fits into our digital tax infrastructure

This isn’t about pressure. It’s about possibility.

Conclusion: If We’re Taxing Cakes, Let’s Also Talk About Capital

We believe CBT is not only timely but necessary to discuss. As Rwanda looks inward for ways to boost national revenue, let’s not ignore the millions that live and earn outside but remain Rwandan through and through.

If weddings are on the tax radar, surely wealth earned abroad deserves a seat at the table too