The legitimacy of local revenue collection in Rwanda hit rock bottom during the 1994 genocide, when local administration began to impose fines on male Hutu members of the community for each day they refused to participate in the mass killing of their Tutsi neighbors. Since these devastating events of state-instigated mass-murder, all levels of government in Rwanda have put tremendous effort into reconciliation and restoring the legitimacy of the state and all its organs. The growing literature on taxation and state-building points to the important role that revenue collection can play in this regard. A social contract based on an exchange relationship between state and tax payers, in which the latter agrees to make tax payments in return for receiving public goods and services from the former, can strengthen not only the prosperity and capacity of a state, but also its legitimacy.

Following this logic, this paper examines the extent to which the Government of Rwanda is making use of its revenue system to encourage tax payers to buy into this exchange relationship, thereby positively affecting their perceptions of taxation and their attitudes towards the state. The focus is on the local level, as this is where most Rwandans interact with government on a regular basis. Specifically, I attempt to uncover how these perceptions shape incentives for tax compliance in Rwanda’s local taxation system and how they affect tax payers’ attitudes towards local government and their perception of its legitimacy as a body of the state.

I use a sequenced multi-methods approach that draws on different qualitative and quantitative methods, and uses both inductive and deductive approaches to data collection and interpretation. In a first stage, I analyze survey data that has been collected with a view to assessing tax payers’ perceptions towards local taxation. Complementing this deductive approach, I examine chatter and street talk about local taxes that I collect with the help of market vendors, who were asked to document any tax-related conversation they overhear during their daily routines. A preliminary analysis of these two data sources identifies main themes and issues with regards to perceptions of local taxation and state legitimacy that I explore further in a second stage using in-depth interviews with tax payers.