Revise laws catering for tax concessions - Ram

Revise laws catering for tax concessions – Ram

Sep 04, 2014 News

The problems which arise from government handing out concessions could be solved if the Administration scraps the current method altogether. This is the view of Chartered Accountant and Lawyer, Christopher Ram.

Ram told Kaieteur News recently that “tax holidays” are only given for activities of a developmental nature. He gave the example of a company going into farming and setting up a 200 acre pilot project. He said such a project should attract exemptions.

However, he said that as it relates to commercial schemes, the companies should pay taxes in keeping with the law. This he said isn’t being applied.

Further, Ram believes that government should abolish the duty free concessions. “There is no accountability in this scheme…and we should remove these tax concessions because they are overpowering us” Ram told Kaieteur News.

”If you want to talk about Low Carbon Development Strategy ….then we could restrict the importation of gas guzzlers” Ram noted.

Over the last two decades billions of dollars in concessions have been granted but very few mechanisms are in place by the various agencies and ministries to gauge how the country has been benefitting.

In a recent interview with this publication Keith Burrowes, Head of the Guyana Office for Investment (GO-Invest) admitted that the entity is guilty of failing to document and analyze the direct and indirect benefits of the concessions. He assured that steps are now being taken to rectify this situation.

Burrowes had stressed that it is important for investment agencies to go beyond the basic tracing of taxes paid to examine how companies, both foreign and local, contribute to the Gross Domestic Product (GDP) when contrasted against the concessions and tax breaks given.

He had explained that a concession is a preferential allowance or rate given by an organization. While various ministries would grant concessions, the government investment agency acts as the entity which makes recommendation on the part of the interested company for certain tax breaks and other concessions that would be needed for the business to start.

He said that it is important to keep in mind that GO-Invest would normally examine the company’s proposal and ensure that it is economically viable before making the recommendation.

Moreover, Burrowes said, that GO-Invest have started the process to conduct a comprehensive analysis on the concessions granted and the benefits received.