| “GRA was politically compromised, lacked accountability” – JordanTax exemptions and concessions granted last year amounted to an astounding $55B (US$275M), with the new Government on Monday vowing widespread reforms to fix a broken system.During his maiden National Budget presentation on Monday, Finance Minister Winston Jordan made it clear that the situation was totally unacceptable with evidence that the Guyana Revenue Authority (GRA) was politically compromised under the previous administration of the People’s Progressive Party/Civic (PPP/C).Speaking on the tax reforms as was promised by the coalition while on the campaign trail for the May 11 General and Regional Elections, the Minister said that among the pledges made was the implementation of an action programme for the first 100 days.This included the immediate implementation of a phased reduction of Value Added Tax (VAT).However, according to Jordan, on assumption to office, they found a tax system that is characterized by high rates. This resulted in “innumerable requests for tax exemptions and concessions, which totaled $55 billion, in 2014.”Also unacceptable was the level of tax evasion that is “clearly unlawful,Cheap NBA Store, discriminatory and stifles competition.Jordan said that there was widespread discretionary elements, which have been used to favour and reward friends, rather than encourage development and with little or no compliance.“In short, Mr. Speaker,Cheap Jerseys Wholesale, the system is broken and we must fix it in a comprehensive manner – one that results in a transparent and predictable tax system that rewards effort, promotes investment, improves our national competitiveness, and removes distortions between and across sectors.”VAT DELAYEDHe said that it is for these reasons that Government has delayed the phased reduction in the VAT as it moves to install a Tax Reform Committee to undertake a detailed assessment of the tax system.“Since major work has been completed in this area recently, we expect the Committee to complete its work by the end of the year.”The statements on tax concessions come amidst wiFinance Minister Winston Jordan, meeting with GRA’s Commissioner-General, Khurshid Sattaur earlier this year.despread complaints that under the previous administration, select persons and companies were indiscriminately being granted tax exemptions and concessions to the tune of hundreds of millions. This held true for high end vehicles for especially remigrants.In the case of concessions, it was unclear what exactly the policy of the previous administrations was, as again hundreds of millions were granted.In one case that has been making headlines recently, Chinese-owned logging company, BaiShanLin, was allowed to import scores of trucks and heavy equipment and granted land to build barges, along with concessions on fuel. Specifically, they were supposed to use the concessions for logging.However, there is evidence that the company is using the concessions to compete with locals in the trucking and river transport (barge) business.Regarding GRA,Wholesale Jerseys Store, the official said that the entity contributes the bulk of revenues intended for the Consolidated Fund.“As a result of declining external inflows to Guyana, due in part to debt relief given under the Highly Indebted Poor Countries (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI),cheap nfl jerseys china, the GRA has assumed added importance over the last decade in generating resources to meet Government expenditure programmes.”Jordan was confident that this role will expand, in the medium term, as the Government accelerates its programmes and projects to enable Guyanese to experience the good life.POLITICS IN GRAHe said that a diagnosis of the problems and challenges facing the entity shows heavy top management of the authority, coupled with low staff morale and a lack of succession planning, both vertically and horizontally.“Further, the authority lacked transparency and accountability, as it was politically compromised under the previous administration. Policies and procedures were poorly enforced, and there was limited intelligence-gathering. Further, the cost of conducting transactions was high, which often led to involuntary compliance.”He said it is imperative that GRA’s organizational and managerial capacity is strengthened and enhanced in a sustainable manner.“In this regard, we will constantly review the current operational standards and bring them in line with international best practices, train a core staff to manage the authority, and build a new ethos that emphasizes service delivery and efficient revenue collection. The expectation is that when the tax reforms are fully implemented, this capacity strengthening will compensate for the decline in foreign inflows.”Last year, tax revenue collections amounted to $135.9B, representing 93.9 percent of total revenue. Internal revenue increased by $5.1 billion or 9.8 percent. This, Minister Jordan said, was primarily attributed to increased collections from private sector companies and a $2.7 billion increase in personal income tax from the Pay As you Earn (PAYE) category.On the other hand,Wholesale Basketball Jerseys, there was a decrease of $581.6 million from withholding tax collections associated with the contraction in the gold mining sector. Customs and trade tax collections totalled $13.5 billion,Cheap NFL Jerseys Wholesale, an improvement of 2.1 percent. Value Added Tax collections rose by 9 percent, to $37.5 billion, largely on account of better administration that resulted in arrears of $2.7 billion being recouped. Excise tax collections increased by 3.5 percent to $28.2 billion.Since taking up office in May, the Finance Minister has already made an inspection visit to GRA’s headquarters on Camp Street. Contracts for a number of workers were not renewed and over 20 senior staffers were sent on outstanding leave.The Commissioner-General, Khurshid Sattaur, who had proceeded on leave, reportedly turned out back to work on Monday. |
