HOW DOES ONE QUALIFY FOR ENTERTAINMENT TAX CONCESSIONS?

Oct 28, 2012 Features / Columnists, Peeping Tom

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Earlier this year, the government indicated that it would be granting import licences for the importation of chicken. This decision came in the wake of a shortage of poultry on the local market, which caused prices to increase.
The reason for this shortage was never satisfactorily explained. In fact, the intelligence of the Guyanese people was insulted with the explanation that Guyanese were eating more chicken. No attempt was made to explain the basis for the assessment that local consumption had increased. But even if this was indeed the case, the increased consumption would not have been an overnight phenomenon, and therefore the supply chain could have been adjusted to cater for any increase in consumption.
The import licences were granted, and immediately after, questions were asked as to the basis for awarding the licences. Again an explanation was given that the licences were awarded on an automatic basis once the importer met the necessary requirements. But what exactly are these requirements?
In a fully transparent government, the authorities would have made available the names of those granted licences and the requirements that importers must meet to be qualified for the grant of an automatic licence.
It is still not too late for the government to publicize the names of those individuals and companies who were granted import licences for chicken. It is also not too late for the government to make public the requirements – storage facilities etc – that an importer needs to have in place before a licence can be granted.
This would allow for an assessment as to whether the process was automatic or not, and if it met satisfactory levels of transparency. It is almost certain that if the list of those granted licences over the past few years and those not granted licences are made public, it would reveal some interesting facts.
Parliament recently emerged out of recess and the tax concessions granted to the promoter of the forthcoming Chris Brown concert were thrown into the spotlight after the shadow minister of finance requested to know the basis for granting these tax concessions.
Unfortunately, in responding to this question, there was a lot of jazz about the importance of tourism and the obligation of the subject ministry to support tourism. What was not clear was just how the government decides which promoters would enjoy tax concessions and which would not.
Unfortunately also, this very legitimate inquiry was shrouded in the controversy as to whether Chris Brown should perform in Guyana, because of him being charged with domestic assault in the United States. But whether it is Chris Brown or some other international superstar, there is a need for the government to indicate the criteria to qualify for these concessions, and the legal basis for the granting of these concessions.
Certainly, the government cannot grant to all promoters these concessions. If this were to happen, the government might as well simply abolish the entertainment tax. But just so as to ensure that there is no discrimination or favouritism involved in granting tax waivers to promoters of major concerts in Guyana, the governments needs to indicate clearly the criteria for someone to qualify for these tax waivers that will be granted to those bringing Chris Brown to Guyana.
Finally, a controversy has arisen over civil embezzlement charges which have been filed against the top executive of an airline that was recently launched. It is noted that the charges that are said to have been filed are civil charges and not criminal charges and one has to therefore ask why – if the allegations being leveled have merit – criminal charges were not leveled.
Regardless, the allegation of embezzlement is not a comforting development for Guyanese travelers who have had bad experiences in the past with airlines that have folded. The same assurances that are being given now were given then.
It is therefore the responsibility of the government to make a statement as to how it intends to protect the interests of those who have bought tickets in the eventuality of the airline being unable to honour its obligations to travelers.
The government also needs to indicate the names of all the investors associated with this airline and what due diligence checks were done on these investors. There are serious implications for Guyana’s continued participation in the airline industry if the charges that have been leveled are upheld in a court of law.
This would make Guyana a party to the use of illicit fund, and this is a stigma that can have serious implications for the country.  As such, the people of Guyana need to know now, not next year, who was responsible for bringing this airline to Guyana, who dealt with the application, and what due diligence checks were done on the principals.

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