‘Don’t pressure your people; remove VAT on private tuition fees’

Mar 08, 2017 News

– Group says in Finance Ministry protest
A small group of protesters yesterday lined the northernmost section of the Main Street avenue, in front of the Ministry of Finance, to express the displeasure with the recent announcement of value added tax (VAT)

The group of protesters standing in front of the Ministry of Finance yesterday.

on private tuition fees.
Several protesters disclosed that although they didn’t have any children in private school, they were standing in solidarity with those parents of children that “have to suffer this draconian judgment by the very politicians that they voted for”.
According to one protester, “the amount of money the government is expected to make from VAT on education is three hundred and fifty million dollars, and when you compare that to our two hundred and fifty billion-dollar budget, it is only 0.14% of the budget, which is such a miniature amount that the government doesn’t need to put its people under pressure for.
I’m not saying that they don’t need it, but what I’m saying is that anything that provides only 0.14% of your budget is not a priority. There is other income that can provide more than that. I don’t understand how our Minister of Finance can say that this small amount of money is going to jump start our economy. I don’t know what sort of economy he is trying to run”.
Even though President David Granger has made it clear that VAT on private tuition fees will remain the same for now, those protesting were optimistic that they will see a change. They said that the protest last week that was held in front of the Guyana Revenue Authority was “for the collectors, and this one is for our policy makers”.
“I am appealing to our President David A. Granger. I think he means good, but there are some people that give him bad counsel. He first says that there will be no VAT on private tuition, then he later changes his mind and says that there would be VAT. Mr. President, you need to listen to your people… don’t stay in the background and just listen to your advisors,” one male protester lamented.
He added that the previous regime’s difficulties have not disappeared with the appointment of a new government, and sadly, what the new government has done is place added pressure on the people.
“We are not against the government for anything; we are not politically affiliated. We are here today to send a message to the government that the Guyanese people are in pain,” the protester said.
This is the second protest that the group has staged which stems directly from a statement Finance Minister Winston Jordan made – that the tax is not unreasonable. In his view, citizens would acquiesce with this move if only they would take a step back and consider some crucial yet “startling” facts.
Jordan added that there are only 54 private schools registered with the Guyana Revenue Authority (GRA). But there are far more than this in and out of Georgetown.
In fact, the 54 schools only represent 57 percent of the private schools that exist in the country.
Of those 54 schools, Jordan said that only 20 percent or 11 are recognized by the Ministry of Education. Ten percent of those private schools are registered as non-profit organizations, while 14 percent are registered as profit-making entities.
Providing further statistics, the Finance Minister said that 26 percent of these institutions are registered for, and are already applying the VAT for some of their services and sale of zero-rated items.
The economist said that both categories provide educational services at competitive rates and the tuition fees range between $144,000 and $300,000 depending on the grade level of the student.
Jordan added that in many cases, it has been determined that the fees payable to the schools exceed those that are even charged by the University of Guyana.
Significantly, Jordan said that the total tuition fees charged by the top eight of these private institutions exceed $2B annually. “So 14 percent of that top eight gives us roughly $280 million to $300 million in VAT. Jordan explained.

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