Dec 02, 2019 News Comments Off on Rigid Monitoring, Reporting systems in place to prevent abuse of petroleum concessions – GRA Boss
By Kiana Wilburg
If anyone thought that the Guyana Revenue Authority (GRA) would sit idly by and allow concessions for the petroleum sector to be abused, they are sadly mistaken, says Commissioner General, Godfrey Statia.
During a recent interview, the tax boss assured that there are strict monitoring and reporting systems in place to ensure Guyana is not being taken for a ride.
Expounding further, the Commissioner General said that discussions were held with ExxonMobil about the blanket concessions it has. Kaieteur News understands that the American oil giant has tax exemptions for more than 600 pieces of machinery and equipment, among other items that would be needed for the Stabroek Block operations. GRA he said, requires monthly reports from ExxonMobil on all the items imported and from whom.
Statia said, “What they would do is submit on a monthly basis, a schedule of all the purchases and who they purchase from with relevant TIN numbers and other information, so when that company or trader submits a form for refunds, for example VAT refunds, we can do our reconciliation first. We can cross-match that information with the very detailed reports, which we collect from Exxon.”
Because of these systems, Statia said that GRA now has a list of trusted traders for the oil sector. He said that these companies have been extremely compliant with the proper use of the concessions.
BE HONEST TRADERS!
The Commissioner General said that if a local company is trying to supply the sector for the first time, and brings in a piece of equipment, pays duty, and can prove that it was sold to ExxonMobil for its operations, without hesitation, the firm would receive a credit or it would be set off against future imports.
The Commissioner General then implored companies, whether foreign or local, to be honest in their request for, and use of concessions, while alluding to the fact that there would be consequences for those who try to abuse the system.
He also stressed that there is no uneven playing field for access to tax breaks for the petroleum sector.
In this regard he said, “There was something in the newspaper where a guy said he was placed at a disadvantage because he can’t bid against those guys benefitting from concessions. He said he can’t bid against them because he has to pay duty.”
The Commissioner General added, “But when you are putting in a bid, you bid for it free of taxes and with taxes and if you already paid it, you would get a refund of taxes if you win the contract. If you can prove you supplied it to oil sector, you get a refund. And if the product is unique to the oil industry, it is classified right away as being nontaxable. I hope people pay attention to that part.”
Statia also implored traders to avoid the temptation of under invoicing or over invoicing. He said this only works against them in their bid to access concessions for the sector.
“What you find in many instances is that some of these guys do not declare the true amount…There is a minimum of 10 percent of taxpayers and maximum 25 percent who submit the true value of what they pay. So since this is what we are dealing with, we are extra cautious about how concessions are granted and for what items.”
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