Aug 16, 2016 News
While the new government is crying out about the number of huge concessions that the People’s
Progressive Party/ Civic (PPP/C) gave to certain companies, former President Donald Ramotar is saying that his government did what was best for Guyana.
The Ministry of Finance has recorded a shortfall in the collection of Value Added Tax (VAT).
Last week, the new Commissioner-General of the Guyana Revenue Authority (GRA) Godfrey Statia told the media that in the first half of this year alone, (between January and June) companies utilized over $20B in exemptions.
He said that this contributed significantly to the drop in VAT collection.
But yesterday Ramotar said that the concessions he granted, benefitted Guyana in many ways.
He said that much of what was granted would have stimulated production.
“The ones granted to stimulate production were mostly given to rice farmers and miners,” said Ramotar.
The former President said that other concessions were granted to encourage investments. “Offering concessions to attract investments is standard. Concessions were not given so that the beneficiaries can just drive around town.”
Speaking about the huge concessions granted to BaiShanLin, Ramotar said that the company was not favoured in any way.
“If a Guyanese had the kind of money and put forward similar investment plans, he or she would have been granted the same concessions.”
Further, the former President said that the benefits Guyana got in return were evident. He said that now BaiShanLin’s operations are stalled, “many people are feeling the squeeze.”
Speaking about the shortfall in VAT collection, Statia said that the main reason for this is the number of concessions and waivers that were granted under the PPP/C government.
He also blamed the decline on the “leakages” at the different ports of entry, which resulted in goods entering the country without the relevant taxes being paid.
Statia said that the GRA will have to shift resources so that improvements can be made in this regard.
“At the domestic level we have to also shift resources into enforcement mode to go behind the businesses and make them comply. So we are looking more at enforcement, compliance, investigation and further examinations so as to increase the VAT collections.”
Statia also stated that the PPP/C had been falling back in the payment of VAT compliance during its last years in office.
“VAT refunds have not been paid in a timely manner for 2013, 2014 and 2015… these were inherited and we are trying to bring the system up to date.”
The Commissioner-General said that already, the new administration paid over $2B in refunds. And by the end of the year, another $3B is expected to be paid.
Minister of Finance Winston Jordan said, “All this inherited stuff is denying revenues to undertake current development.”
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