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CORRUPTION WILL INCREASE!

Feb 09, 2016 Features / Columnists, Peeping Tom

The purpose for each person having a tax identification number (TIN) was to allow the tax department to have a record of every taxpayer or potential taxpayer in the country.  If you wanted to do any form of business with the government you require a TIN.
In this way, the Guyana Revenue Authority is able to have almost all adults register for tax purposes in the country. Now with such an extensive database which allows the GRA to check its records to see who has paid taxes and who has not paid taxes, can someone explain to me the logic behind the decision of the government to demand that before anyone renews his or her driver’s license that persons has to produce a tax clearance certificate.
This measure is seemingly being implemented as a means of ensuring that people pay their taxes. But why demand a tax clearance certificate when the GRA already has in its possession the TIN numbers of every taxpayer and can simply check its system to see who has paid their taxes and who has not?
All the GRA has to do is to run its system and determine whose taxes are outstanding. This was the purpose of the TIN.
The GRA is also effectively placing the burden of determining whether someone has paid his or her taxes on the person. But why do this when under the common law that burden already rests with the taxpayers?
I have said it before: tax policies that are based on flawed analysis will lead to flawed results. The government wants to collect more taxes and so it feels that by forcing people to have to put their taxes in order will yield more taxes. This is not a valid argument because simply having people submit their income tax returns does not necessarily mean that it will produce any more taxes.
But even it more taxes can be obtained, why ask for a tax compliance certificate when the same effect can be had by GRA simply checking its system to see who has paid and who has not paid and sending those persons demand notice.
The tax collectors have to do their job. They have to find those who are not paying their taxes and go after them. It takes weeks to obtain a tax clearance certificate. With the massive number of persons who are now going to apply for such certificates it will take months.
Is the Ministry of Finance so divorced from reality that it could not foresee this?
The law has to be changed to allow for this demand for a tax clearance certificate before the renewal of licenses. This is measure which cannot be implemented with a mere notice in the papers.
Unless the law in changed to demand a tax clearance certificate before a license is issued, then someone needs to challenge the new rule. Unless it is sanctioned by the law, it should not be allowed to stand.
Desmond Hoyte had the foresight to remove the need for tax clearance certificates before persons left the country.  He knew the corruption that this system bred. Persons paid money to get their travel clearance certificates.
The need for travel clearance certificates led to a lot of corruption within the Inland Revenue Department (IRD) If you knew people within the IRD you could have your tax clearance without so much as a sneeze.
The PNC administration lacks imagination. Instead of coming up with new and modern policies to boost revenue collection, the government is returning to the old days and the same old measures of a discredited system.

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