Despite new tax regime…Many miners still operating “business as usual”- GGDMA

May 06, 2017 News

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-some operators not deducting 20 percent Tributor’s Tax

Despite new tax arrangements for miners, many of them still appear not to understand the realities of keeping proper records.
The Guyana and Diamond Miners Association (GGDMA) warned yesterday that they

will not feel the realities of this until the time comes for them to file tax returns next year.
“We believe that many miners are operating in a “business as usual” fashion and they will not feel the brunt of their ill-advised activities until they have to make up their books and file tax returns come 2018,” the association advised in a paid statement published in Kaieteur News yesterday.
The GGDMA said it is urging all small and medium scale miners to immediately seek advice from a reputable accounting firm so that their affairs can be fully compliant with the new tax regulations imposed on miners as a result of Budget 2017.
“Already, the new tax regulations are creating significant hardships and chaos in the sector where mining operations endeavoring to be tax compliant have lost a significant number of their experienced and skilled workers to the other operators who have chosen not to deduct the 20 percent tributor’s tax.”
According to GGDMA, additionally, the main overarching concern remains where most, if not all, small and medium scale operators will find themselves in a tough spot come 2018 where “acceptable records” to justify operating expenses will not be available if requested by the Guyana Revenue Authority (GRA).
As a consequence, the association said that many miners will not be able to justifiably compute their further tax payments, in addition to the two percent royalty which would have already been deducted from gross sales.
The GGDMA said that this would come at a time when the small and medium scale miners would have surpassed their gold declarations in the first quarter of 2017, as compared to the same period in 2016.
“All miners should be commended for continuing to play their crucial role in bolstering Guyana’s economy in this time of reduced investment and economic slowdown. The gold mining sector continues to be the only shining beacon in our economy, without which the country would truly be in a dismal state.”
Ironically, the GGDMA said, while the gold and diamond mining sector is recognized by Government for its importance in bolstering Guyana’s economy, many of the needs of the small and medium scale operators continue to be ignored by the powers that be.
“This has brought a lot of unease to minds of miners in recent times. Miners are hardworking, risk-taking individuals whose contributions have proven vital to the growth and development of Guyana.”
The association, which says it represents the industry, noted that despite the execution of agreements since December last year with the Government of Guyana to allow tax compliant miners to benefit from certain welcomed concessions on fuel and materials utilized in the sector, none of these benefits have been realized by any miner, to the best of the association’s knowledge.
“This is mainly as a result of bureaucratic bottlenecks experienced at the level of GGMC and other agencies. Given that approximately over four months have elapsed since this agreement was executed and less than eight months remain on the life of the agreement. These delays prompt us to ask: Does the Government of Guyana truly want small and medium scale miners to benefit from these concessions or was this agreement executed for media propaganda purposes? We truly hope that this is not the case and wait to be proven wrong.”
The association also stressed that it remains very concerned that while the small and medium scale miners are publicly recognized for their production capabilities and stalwart contribution to the economy, their genuine issues remain unaddressed by the relevant authorities.
“The GGDMA is still hopeful that the association can meet with President (David) Granger and senior government functionaries to have these and other matters resolved to the mutual benefit of small and medium scale operators and the state.”
Since taking office in 2015, the administration has announced a host of measures to capture tax evaders and non-compliant persons.
The gold sector has been seen as one of the major ones where many of the operators have not been keeping proper records with billions lost in taxes.
However, the operators have been finding the going hard as many of them have been running loose operations.
Gold has remained the biggest foreign currency earner for Guyana in the last decade.

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