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Oct 23, 2017 News
As Finance Minister, Winston Jordan, continues the preparation work for Budget 2018, one tax analyst is cautioning that there are still several tax measures which Jordan may wish to consider.
Specifically making this comment recently was Chartered Accountant and Attorney-at-Law, Christopher Ram.
Ram noted that the Tax Reform Commission which was established by the David Granger administration, had compiled in its comprehensive report, a menu of recommendations which should be taken on board to correct Guyana’s tax system.
Ram noted in his recent writings, however, that the majority of the Commission’s recommendations remain unimplemented.
Ram said that the Commission never had the opportunity to discuss the Report or any of its recommendations with the Minister. But he still believes that there are recommendations in the report which must be paid attention to.
The tax analyst noted that the Commission called for the removal of income tax exemptions granted to certain office holders, such as the President, Attorney General, Chancellor, Chief Justice and Auditor General. He said that for Ministers, Public Officers and Officials, the VAT should be restored on all passenger car imports and the differentiation of cars by age should be removed.
The Tax Reform Commission also advocated for the immediate reduction of the corporate tax rate on telecommunication companies from 45 percent to 40 percent in 2016; and on commercial companies from 40 percent to 35 percent.
He said that there is a need to provide tax incentives, which themselves should be based on clear and rational criteria, through tax laws, which must include provisions for an annual review and withdrawal of the incentives where conditions are not met.
Ram stressed that there is also a need to widen the tax net, and that Government should grant a tax amnesty which could address the presumptive tax.
“Some of the recommendations were expected to be controversial, particularly those designed to have a redistributive effect such as the reintroduction of estate duty and taxation of dividends above a certain level. There were also some that mixed revenue with social policy such as a tobacco levy and a health levy on alcoholic beverages.
“These are only some of the unimplemented measures available to the Minister of Finance. The Tax Reform Commission had estimated that its proposals excluding amnesty, government transfers, etc, would be revenue neutral, but that there would be some rebalancing in the system.”
The attorney said that hopefully, some of the proposals will be considered for the 2018 Budget.
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