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Revenue boss “disturbed” by recent CCJ ruling
The country’s revenue chief, Khurshid Sattaur, is “disturbed” by the recent decision of the Caribbean’s highest appellate court to have the government payback a Surinamese beverage importer US$6 million.
The money was charged by the Guyana Revenue Authority (GRA) as an environmental tax. Any bottled beverage imported in the country attracts an Environment Tax of $10.
Khurshid Sattaur
Sattaur, Commissioner General of the GRA, said he is now left in a quandary to decide whether he should continue imposing the tax.
“I find the ruling most absurd and contentious. I am very aggrieved about it; I am very disturbed about it,” Sattaur said in an interview.
The Surinamese company Rudisa Beverages and Juices NV, known for its “Thrill” line of beverages, and co-claimant, Caribbean International Distributors Inc. (CIDI), had gone to the Caribbean Court of Justice (CCJ). The parties contended, and the court ruled, that the tax violated the rules of trading in the regional trade and integration bloc CARICOM, of which both Guyana and Suriname are members.
In May last year, the government failed to get the support of the Opposition to pass an amendment to the Customs Amendment Bill under which the Environment Tax is imposed.
The tax came into being in 1995, and imposes $10 on every metal, glass or plastic container holding any drink, alcoholic or non-alcoholic, coming into the country.
Rudisa and CIDI essentially argued that the tax amounted to unfair competition, since with the tax they were forced to raise their prices by $10, while no similar tax is imposed on beverages produced locally and sold in non-returnable containers.
As such they argued that the tax must be seen as an import duty and this violates CARICOM’s Treaty of Chaguaramas which guarantees the free movement of goods and prohibits import duties on CARICOM goods.
The Government wanted to reduce that tax by $5 dollars, but to impose a $5 tax on goods imported to produce such beverages locally. That would have leveled the playing field and come into compliance with the rules of trading in CARICOM.
The Opposition argued that the tax would be a burden on already overburdened taxpayers. What is more, the Opposition argued that the billions of dollars collected since the introduction of the tax have not served its purpose.
“When we see what is happening in Georgetown, and all that garbage, and all the environmental hazards, we have to ask where all that money is going,” leader of the seven-seat Parliamentary party Alliance For Change stated.
“A li’l rain fall the other day, the whole city stinks…what is it that we are doing with this tax that is being collected?”
The CCJ ruled that Guyana could not show how the tax was passed on to the consumer or to a third party and so was obligated to repay the tax.
Sattaur argued otherwise. He said that the money collected over the years has served the government well in helping to clean up the environment, as was intended.
Companies which export their empty bottles can request a refund of the tax from the GRA.
“If however, it doesn’t go out back, then you suffer the tax at the point of importation. You don’t have any refund to get,” Sattaur stated.
(Neil Marks)
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