The successful operation was conducted by the Revenue Protection Unit (RPU) at about 5am, which also resulted into the arrest of four people in connection with the fraud.
The bales had been sneaked into Rwanda from the Democratic Republic of Congo (DRC), Police said.
The arrested smugglers are identified as Elias Ntamakiriro, 30, Samuel Ndayishimiye, 48, Felicien Ndayizeye, 34, and Aimee Nyirandorwa, 28.
CIP Bonaventure Twizere Karekezi, the Police spokesperson for the Western region, said that the quartet was arrested due to information provided by local residents.
"RPU received prior information that five bales of second-hand clothes had been sneaked into Rwanda through Lake Kivu in Tyazo Sector. Information also indicated that the bales would be loaded on a vehicle and transported to Mugonero market in Gishyita Sector, Karongi District," said CIP Karekezi.
"Following this information, RPU mounted a check-point along Nyamasheke-Karongi road and the vehicle (omnibus) was intercepted in Gabiro village, the driver Elias Ntamakiriro and his turnboy Samuel Ndayishimiye taken into custody," he added.
Ntamakiriro and Ndayishimiye disclosed to the Police that they were hired by Aimee Nyirandorwa, who was also located and arrested at Mugonera market alongside his accomplice Ndayizeye.
CIP Karekezi thanked the residents, who shared information leading to the arrest of the suspected smugglers and seizure of the smuggled goods.
He warned against fraud and illegal cross-border, which can also lead to the spread of Covid-19.
The suspects were handed over to RIB at Bwishyura station for further investigation while the bales were taken to Revenue Protection unit (RPU) in Karongi.
In article 199 of the East African Community Management Act, which is also applicable in Rwanda, any automobile used in smuggling and seized smuggled goods are auctioned while the driver is fined US$5, 000.
A taxpayer, who commits fraud, is also subject to an administrative fine of one hundred percent (100%) of the evaded tax and a likely imprisonment of between six months and two years.