Managing director of the International Monetary Fund, Christine Lagarde, believes that this will aid the country in being less dependent on external aid.
“Mobilising domestic revenues will be critical in creating fiscal space as reliance on aid gradually recedes,” Lagarde said.
"At 16 per cent of GDP, the tax collection effort is still low compared to peers in Africa, and well below the 25 per cent target set by the East African Community."
In August, the Rwanda Revenue Authority (RRA) suffered a setback in its efforts to wean the country off aid.
The taxman also expressed fears that the country had not collected enough taxes to meet its revenue targets for the 2013/2014 financial year, despite a string of stringent measures by the government to meet its growing budgetary needs.
Moreover, in order for the East African country to achieve its middle income country status in the next five years, Lagarde said the country should focus on "encouraging private sector development to reduce reliance on the public sector, and harnessing the potential of regional integration to support export diversification and overcome geographics.”
(READ MORE: Rwanda keen to become regional economic powerhouse)
The country, which is committed to sustainable economic growth, has made impressive progress in rehabilitating and stabilising its economy.
Positive actions taken by Rwanda's government has also ensured that the country maintained a decade-long period of strong economic growth.
“Since the early 2000s, Rwanda has grown at an average of about eight per cent, well above the regional average and on par with emerging Asia,” Lagarde said.
"Per capita income has more than trebled, and while poverty is still high at about 45 per cent of the population, the poorest have shared the benefits of growth."
(READ MORE: World Bank gives Rwanda $70 mln to help fight poverty)
Regarding Africa’s growth, Lagarde cautioned that the revising of global economic forecasts will slightly slow down the continent’s growth.
“Growth forecasts for sub-Saharan Africa have been pared down due to lower oil and commodity prices," she said.
"Still, the overall outlook remains promising, and at close to five per cent, the region is expected to post the world’s second highest growth rate in 2015."