Latest update March 28th, 2024 12:59 AM
Aug 17, 2018 Features / Columnists, Peeping Tom
Two officials were on yesterday’s morning show on NCN-TV. One of the things they reported was that a law has been passed which allows the Guyana Revenue Authority (GRA) to issue a provisional two-year licence to new shops until such time that they get all their “paperwork” in place.
To establish a shop, a number of permits have to be obtained, and this takes time. The GRA in order to issue a shop licence requires that all these authorizations – local authority, fire service, etc. – are in place. These permits take time to be obtained. The provisional licence allows the business to be able to be lawful under the country’s tax laws, while awaiting the requisite authorizations.
There are many persons who will find favour with this regulation. But the GRA is not being flexible and understanding about the red tape which businesses have to endure. This is purely a means by which GRA can widen its tax base, since in order to obtain the provisional shop licence, an applicant’s taxes have to be in order.
It is all well and good for the GRA to employ provisional devices to widen its tax catch. But the GRA must be even-handed at the same time.
The reason why the GRA is having to use such devices to capture more businesses within the tax net, is because it knows that Guyana’s informal sector is extremely large. There are many businesses who are operating outside of the tax net or who are misrepresenting their levels of business. However you twist it or turn it, a shop licence is simply an indirect means of registering businesses for tax purposes.
The GRA is therefore trying to ensure that they capture these new businesses on their books. But what about the large number of businesses that are not interested in a formal, legal personality?
What about the vendors who sell within, outside and near to the city markets, and who are not registered, and therefore do not have to pay any taxes or obtain any licences? What about those businesses who are unlawfully vending on government reserves and on parapets? What about those hustlers who vend their wares near the traffic lights? How will the GRA register them for taxes?
These informal businesses are seizing a large slice of the commercial pie. They seek the busy areas to set up shop and stands. They seek to maximize sales by vending in areas where there is heavy traffic such as near to markets and bus and car parks.
On the other hand, a formal business has to invest in either purchasing or renting business space; has to employ workers; pay NIS; pay interest on loans accrued for working capital and overheads; and then still face unfair competition from those who have no such obligations.
When is the GRA going to ask the government to pass a law to ensure a level playing field so that vendors and informal businesses are regularized? When is the government going to take steps to reduce this high level of unfair competition which is faced by businesses?
Guyanese firms are at a distinct disadvantage in comparison to their regional counterparts who do not face such a high incidence of unfair competition.
There are vendors who are selling outside stores on Regent Street. Some of them are vending the same items which are being sold inside, and it is not that they are an extension or are wholesale customers of those stores; they are competitors. They befriend some of the workers in these stores so that when you go into the store for an item, the friend tells lies to you by claiming the store does not have the size of the item you request, but that you can get it and get it cheaper from the vendor outside.
THIS IDIOT TELLING GUYANA WE HAVE NO SAY IN THE 50% PROFIT SHARING AGREEMENT WE HAVE WITH EXXON.
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