By Abena Rockcliffe-Campbell
On January 1, 2007, Guyana was officially introduced to Value Added Tax (VAT). Over the years, the VAT net has been getting bigger and bigger to the extent that in 2017, VAT was even placed on education. It was removed by 2018 after public pressure was placed on the APNU+AFC government.
Therefore, it is safe to say that over the years, VAT has been a topical matter. Yet, the entrepreneurs living and operating in the border town of Lethem are largely unaware of this tax.
Kaieteur News recently visited Lethem’s commercial zone.
Chinese businesses enjoy full control of that area. No less than 20 stores are owned and operated by Chinese in the Lethem Commercial Zone. They service the Brazilian market. Those Brazilians who live in the three towns closest to the Guyana boarder usually frequent the zone.
But this newspaper understands that no VAT is being paid by those business owners in the zone despite the fact that they are estimated to be making significant profits and are believed to be not paying other pertinent taxes or making contributions to the National Insurance Scheme on behalf of their workers.
Kaieteur News understands that just a few businesses in Lethem are registered for Vat.
“I can count them on my one hand,” a source said.
Indications are that the Guyana Revenue Authority (GRA) is moving soon to have these business owners come on board the ‘VAT wagon’.
But, before that, these businesses will have to be sensitized.
A source indicated that registration is slated to begin soon but said, “There will be an awareness campaign first. We will have a stakeholder meeting with all the parties involved mainly the Chamber of Commerce. VAT is serious business, you need to educate people, show them how to set up the system and so on to actually administer it.”
The source was keen to note, “A lot needs to be regularized.”
When goods go to Lethem, it is taken for granted that the relevant taxes, other than VAT, have already been paid to GRA in Georgetown.
This newspaper was told, “There has been a significant increase in the value of goods in Georgetown so what goes to Lethem are items that already paid necessary tax in Georgetown.”
Asked if the Chinese pay taxes on sales, this newspaper was told, “they do the tax return; some do it in Lethem, others in town.”
The GRA Lethem does not have the capacity now to verify sale qualities. There is no audit section and the office only got “hooked up to head office” last year.
Further, that office only recently moved a little in the technological arena, in that a few things are now computerized. Before, everything was done on paper.
Approximately six months ago, GRA started printing tin certificates and motor vehicle licence in Lethem.
This newspaper was told that the Commissioner General, Godfrey Statia “is very helpful and so we are only now getting a few things needed for a long time.”
Pointing to the improvements, the source said, “like I told you, we do not have an audit unit but we are to get that soon.”
Basically what the GRA office in Lethem focuses on is the “regularization of businesses, ensuring they get shop licence, etc.”
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