The Guyana Revenue Authority (GRA) continues to foster a close relationship with the United States of America, a country that is known to have the largest Guyanese Diaspora. Further, the Authority is moving closer to sharing
GRA’s Commissioner-General, Godfrey Statia recently told the media, “In the area of sharing of information we have actually finished the FATCA (Foreign Account Tax Compliance Act) regulations and have signed the FATCA agreement with the US. Our software will soon be installed whereby we will be able to share info with the US.”
Statia said that that advancement will eliminate problems with correspondent banking. “So the problems that the banks have been getting will be something of the past. The legislation has already been read and we are now looking at the regulations part.”
In October last year, Guyana and the US signed an agreement for the exchange of information under the Foreign Account Tax Compliance Act. The agreement was signed by Minister of Finance, Winston Jordan and US Ambassador to Guyana, Perry Holloway.
At the signing, Minister Jordan said the agreement represented another step in the cooperation between Guyana and the US to combat money laundering and tax evasion and avoidance.
He said that the sharing of information across countries is important for the enforcement of domestic tax laws.
“By working together to increase transparency, both Guyana and the US will be able to detect and deter abuse of the tax system in both countries. This will enable better accountability within the global financial sector,” Jordan said.
FATCA was enacted in 2010 by the US Congress to prevent tax fraud and evasion by US taxpayers using offshore banking facilities. It created a new regime of automatic tax information sharing between financial institutions.
FATCA requests foreign financial institutions to identify and report information about accounts held by US taxpayers in their jurisdictions. FATCA is part of a global movement towards Automatic Exchange of Information (AEIO) of non-resident financial account data among tax authorities.
Jordan said that the automatic exchange of information has the potential to increase transparency, cooperation and accountability among financial institutions and encourage tax payers to voluntarily disclose all relevant information to tax authorities.
The enforcement of the FATCA required the Government of Guyana to amend local laws to empower the Guyana Revenue Authority to send and receive information as may be requested by any of the two signatories.
Guyana amended Section 63 of the Financial Institutions Act, Chap 85:03, Laws of Guyana, to designate the Guyana Revenue Authority as the competent Authority, on behalf of the Government of Guyana. That was in 2015.
The amendment was passed without the voting support of the Opposition.
That Bill gives GRA the lawful go-ahead to access all suspicious bank accounts. In addition, it paved the way for a relationship that is now being enjoyed. This allows Guyana to know the financial standing of all Guyanese citizens with bank accounts in the USA.
Reciprocally, the GRA will be required to send bank statements of all American citizens residing in Guyana and even Guyanese who may have ties to the USA, even by marriage.
Minister within the Ministry of Finance, Jaipaul Sharma said that once GRA is given the information from the United States, the State Assets Recovery Unit (SARU) will be able to access such information for investigative purposes.
It was emphasised that regulations such as FATCA will aid in a return of stability and trust in the country’s financial sector. It will avoid the reoccurrence of recent developments which saw the Bank of America pulling out as the correspondent bank to Guyana’s banking sector.
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