Difficult to find another policy shift that has promised as much for tax compliance in developing countries as digitalization. Yet the evidence on its impact is scant. Using the universe of tax filings in Rwanda over the period 2012-2019, this paper investigates the extent to which digitalization (in the form of e-invoicing) has impacted on VAT compliance and in particular the effectiveness of tax audits. The evidence suggests that on the aggregate e-invoicing adoption has increased firms' net VAT payments and has improved the efficiency of VAT audits. It is also shown that e-invoicing has a sizeable impact on VAT liabilities reported by audited firms, with this impact being attributed to tax audits being more efficient rather than to VAT registered firms becoming more compliant following their adoption of e-invoicing.