Explanations for the increase in revenues

Jul 24, 2016 Letters

Dear Editor,
Recently, Finance Minister, Winston Jordon reported that central government’s revenue totaled $53.4 billion at the end of April 2016. According to him this represents an increase of $3 billion compared to revenue collection during the same period last year.
This came about due to tightening up at ports, including the clampdown on illegal activities. The GRA which is the body mandated to supervise our tax policies, has been very compromising in administering the tax system. For personal benefits, many officers of this body have allowed leakage of important revenues which should have been channeled for developmental purposes. The bottom line is that many who corrupt the system to avoid payment of taxes are now made to pay.
This represents positive changes and a laudable effort by the Finance Minister. However, there is still some more work to be done by the tax dragnet. Many self employed persons who make tons of profits do not pay any taxes. This is being very unfair to wage earners who work for miserly sums and have to pay regressive taxes, especially on items indirectly taxed.
New policies should be formulated and carefully administered as any oversight or lack of consistency can have dangerous connotation which some politicians are like blood hounds ready to exploit . In many of the policies of the past administration, a lot of sweetheart concessions were given domestically and to foreigners. A lot of instances this generosity could not be rationalized and so it should be due for serious review.
Indeed while the Treasury is benefiting from increased tax revenue simultaneously there is also some decline in other areas. The latter however must not be taken out of context but must be properly understood. The main reason for our decline is the fall in revenue from sugar and rice. The El-Nino phenomenon exacerbated this situation. Perennially sugar bailout took a toll on our finance. With rice, an artificial situation was created where Venezuela gave us far above market price for our commodity. To my mind this was to keep us at bay with our activities in drilling for oil. As soon as we “bore” oil this Petro-Carib facility came to an abrupt end. Many farmers who invested found themselves in financial straits.
The hangover lingers until this day. It is made to appear that this present government is responsible, even though the past administration cannot give account for hundreds of millions from this fund.
A massive reason for this decline is that corruption was so institutionalized that many billions were lost from this scourge. Many people, like the old age pensioners were double dipping. Services that were provided free carried a cost. Many offices were guilty of this practice. Only recently the R.E.O of Region 2 was looking at a contract of $60 million in lumber. When he checked on the supplier, he hardly had anything to supply. A withdrawal of corruption money from circulation is one of the main reasons for reduced spending in the economy.
Narco trade in Guyana has provided lots of the money that used to be in circulation. Drug money and money from corruption always have the greatest velocity of circulation. Money that comes easily also goes easily. This also impacted as measures have now stifled the drug trade.
Finally it must not be forgotten that our trade and remittance from ABC countries has not been thriving as it was formally. A lot of countries are facing a downturn from the trade cycle. Trinidad has had serious cutbacks including retrenchment; many Venezuelans are starving; Britain has broken away from the European Union etc.
Gradually it will become apparent that though we have this downturn the naysayers will never admit that we have a silver lining with imminent emergence. The propagandists who are in the habit of screaming their unholy mantras are now having a harder time.
Nazir Mohamed
AFC- Region 2

1 thoughts on “Explanations for the increase in revenues”

Muhammad Raoof July 24, 2016 at 1:38 am

What you are saying to the Guyana working class is that the increase revenues are coming front TAXATION. We have found ourselves as a nation, we are becoming too dependent on taxing the people to support the countries plans.. The new Coalition have not implemented not one industry to date that is or is generating revenue.

We are hearing many excuses why our industries are failing. On the other hand, we do not hear what is or will be done to reverse the downward trend. Any nation that is so dependant on taxation, will never survive. Gold seems to be the only shining star in this our economy.

We are experiencing a total lack of vision from our elected officials. As I’ve mentioned, they have failed to date to implement (create) any industry that will or could be a currency earner for our country. You mention that “we have a silver lining with imminent emergence?
We wish that you had elaborated on that. The general population is at “wits’ end” as to what the Coalition is doing.