More than 20 countries give 3 to 5-year tax holiday

Jan 01, 2018 News

… Guyana gives ExxonMobil unlimited

Oil companies always have a long list of demands; one of them being tax holidays.
In the case of Guyana, the Government has granted ExxonMobil a premium tax exemption package.
According to Article 15 of the Production Sharing Agreement (PSA) with ExxonMobil, “no tax, VAT, excise tax, duty, fee, charge or impost should be levied at the date or from time to time thereafter on the Contractor or affiliated companies in respect of income derived from Petroleum Operations or in respect of any property held or transactions undertaken or activities performed, for any purpose authorised or contemplated…”
This tax holiday will last for the life of the contract.
However, while Guyana gave this premium package to ExxonMobil, there are more than 20 other nations which provide only a three to five-year tax holiday to oil companies.

Chartered Accountant, Chris Ram

Natural Resources Minister, Raphael Trotman

This allows the operators a specific time period in which to recoup some of their investments. Some of these nations include: Myanmar, Korea, Malaysia, Spain, Syria, Thailand, United States, Vietnam, Ireland, Congo, Cameroon, Angola, Australia, Ireland, Gabon, Egypt, Morocco, New Zealand, India, Albania, China, Colombia, Nigeria, Papua New Guinea, Philippines.
This information is also noted in the text, Petroleum fiscal Systems and Production Sharing Contracts by Daniel Johnson.
Speaking with Kaieteur News recently, Chartered Accountant, Chris Ram noted that it is not illegal that Guyana provided such a package to the company. Ram noted however that it is important for the Minister of Natural Resources, Raphael Trotman, to explain why this arrangement was given to ExxonMobil.

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