GCCI and GMSA unaware of members unable to get same tax breaks as foreign companies

Nov 28, 2019 News

– Promise to undertake review

By Kiana Wilburg

In the Production Sharing Agreement (PSA) signed between Guyana and ExxonMobil, there is a provision which states that subcontractors and affiliate companies of the American oil giant would benefit from tax breaks on all imports for the oil sector.

GMSA President, Clinton Williams

GCCI President, Nicholas Deygoo

But this very clause has stirred a debate in the local business community. At the heart of the discourse are claims that the condition only benefits foreign companies.
Making these utterances have been the Georgetown Chamber of Commerce and Industry (GCCI), and of recent, the Guyana Manufacturing and Services Association (GMSA).
But when asked about specific cases where locals have not been able to access the same concessions available to foreign companies, the private sector bodies could not say.
Specifically, GMSA President, Clinton Williams, said that he does not have all the information on members who would have been placed at a disadvantage.
He said, however, that the Association has already started the process of collecting information in this regard. “…It is a work in progress,” he added.
Williams acknowledged that GMSA has not had any discussion with the Guyana Revenue Authority

PSC Head, Captain Gerry Gouveia

(GRA) on how many locals have been facilitated with tax breaks versus foreign companies.
This newspaper confirmed with GRA that this type of data is closely monitored.
Furthermore, GMSA sent out a statement to the media on Tuesday where it stated that, “…Local manufacturers continue to face the hardship of being unable to enjoy the same benefits as foreigners entering into the country primarily to maximise the benefits associated with the new oil and gas industry.”
Even as it urged the government to undertake an evaluation of the concessions granted for the oil sector, it provided no clear-cut examples of “the hardship” being experienced or whether these companies would have requested GRA’s assistance in accessing tax breaks but were turned down.
President of the Georgetown Chamber of Commerce Industry (GCCI), Nicholas Deygoo, admitted that while he is not au fait with the number of Chamber members who are unable to access tax waivers, he disclosed that a discussion on this and other related matters is expected to take place soon with GRA.
Following that meeting, Deygoo, who has been a staunch advocate for a Local Content Policy and accompanying Legislation, committed to questioning his members on this issue.

GRA Commissioner General, Godfrey Statia

As for the Private Sector Commission (PSC), its current Chair, Captain Gerry Gouveia, told Kaieteur News that he has not received any complaints on this matter from his members.
He noted that the Commission’s mantra has been, and will continue to be, the creation of a policy that puts Guyanese first. He also took the opportunity to note the importance for local businesses to start the process of upgrading their skills and capacity to meet the demands of the oil sector.
In September, this newspaper would have published an excerpt of an interview with GRA Commissioner General, Godfrey Statia, who emphatically stated that he is a proponent for local companies being given a fair opportunity to compete alongside foreign enterprises in the oil sector.
He subsequently promised that locals will be given tax breaks that foreign firms enjoy while noting that he will not sit and wait for a policy to make this happen.
The tax chief did express fear, however, that some companies may want to abuse the process to bring in dual purpose products.
But the Commissioner General, in no uncertain terms, said he will guard against this with foolproof mechanisms that are at his disposal.

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