Breaking the back of illegal activities…GRA to provide incentives to whistleblowers this year

Jan 08, 2018 News

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By: Kiana Wilburg

The Guyana Revenue Authority (GRA) will be providing incentives to whistleblowers who can help them prosecute individuals who rob the nation of billions in yearly revenue.
This was disclosed recently by senior officials who said that the initiative will begin this year. The officials declined to divulge details of the plan, due to its sensitive nature.
The whistle-blowing initiative and other efforts to break the back of illegal activities are an about-turn in GRA’s Law Enforcement and Investigation Division (LEID), which, over the past ten years, has been sorely criticized for underperforming.
But since August of last year, the department appears to have been stepping its game up. GRA officials confirmed with this publication that revenue collection has increased due to LEID’s improved performance.
Kaieteur News was also able to confirm that the Division will be strengthened for 2018 with the necessary human resources as well as equipment to boost its work. With the revamp that is expected to place, GRA officials confirmed that revenue growth is expected to “surpass expectations for 2018.”
It was also revealed that LEID will be stepping up its efforts to bring in more information on illegal activities, through the ‘whistleblower’ programme and other initiatives.
The revenue authority also made several strides in improving tax administration systems.

IMPROVED RELATIONS
GRA is anticipated to step up its cooperation with a number of agencies for next year. These include the Special Organized Crime Unit (SOCU), the State Assets Recovery Agency (SARA), the Financial Intelligence Unit (FIU), the Guyana Geology and Mines Commission (GGMC), the Civil Aviation Department and the Guyana Office for Investment (Go-Invest).
According to GRA Commissioner General, Godfrey Statia, the cooperation between these agencies is important not only for the sharing of information but for revenue collection, implementation of incentives and Investment Development Agreements, and anti-money laundering activities.
Statia noted that initiatives have been made for Memorandums of Understanding to be executed between these organizations and they are in the draft stage. The Commissioner General confirmed that these should be completed by mid 2018.

OTHER ACCOMPLISHMENTS
As for other noteworthy accomplishments, Statia noted that automated risk profiling processes have been implemented this year. He said that while this system has led to increased revenue, there are still some bottle necks. He said that the advent of the ASYCUDA will improve on the present system and remove this anomaly.
GRA’s current accounting system, the Total Revenue Integrated Processing System (TRIPS), has been working inefficiently for close to 10 years. It is on this premise that the Authority has hastened efforts towards acquiring a more foolproof system called the Automated System for Customs Data (ASYCUDA).

Statia recently spoke on the importance of moving from TRIPS to ASYCUDA. He noted that an examination of the TRIPS system had revealed that there were several problems which caused it to not work effectively.
Statia even stated that millions of US dollars from 2013 to 2016 were expended so as to bring the archaic TRIPS 1 System up to date. In fact, the GRA boss said that many of the modules paid for regarding the TRIPS 1 System in 2007 were never even delivered.
The Commissioner General asserted that based on the state of affairs governing the revenue authority’s IT system, discussions were held with Crown Agents, an international firm that specializes in practical and consistent solutions to financial institutions and governments.
He said that the following was decided: Cease all work on the Customs modules of the TRIPS 1 system; Concentrate all activity on the completion of the Internal Revenue Modules inclusive of e-filing services with clear delivery dates and hold further payments until the delivery of these modules.
Simultaneously, Statia commented that the GRA began discussions with United Nations Conference on Trade and Development (UNCTAD) regarding the introduction of the ASYCUDA single window system.
The ASYCUDA, he explained, is an integrated customs management system for international trade and transport operations in a modern automated environment which allows for customs administrations and the trade community to comply with international standards when fulfilling import, export and transit related procedures.
Through its ASYCUDA Programme, GRA hopes to modernize customs operations and improve revenue collection; facilitate trade efficiency and competitiveness by substantially reducing transaction time and costs; improve security by streamlining procedures of cargo control, transit of goods and clearance of goods; reduce corruption by enhancing the transparency of transactions; and promote sustainable development by cutting down on the use of paper, through the use of electronic transactions and documents.
The Commissioner General said that the agreement with UNCTAD has been signed, payment has been effected, and the team to run the new system has been chosen. Statia said that training will shortly commence, and a pilot project will commence thereafter at the John Fernandes wharf.
Further to that, the Commissioner General said that testing has begun for the remaining TRIPS modules which were never implemented.
He said, “I am assured by my IT staff that they seem promising, and GRA would be in a position to offer some eservices including e-filing in time for the 2018 filing season.”

THE CONSEQUENCES
The failure of the Revenue Authority to implement critical parts of the TRIPS System spans almost 10 years. The consequences of the entity’s actions led to billions in revenue leakages and even rampant corruption.
Statia explained that the IT system referred to as the Total Revenue Integrated Processing System (TRIPS), was intended to merge all departments by having a common database where all tax records could be scanned or entered into the system and found when needed.
It was introduced with the aim of boosting efficiency in the assessment, collection and accounting for revenue.
TRIPS comprises of two core applications: Taxes and Customs, which share information with each other and each application encompasses a total of 13 modules.
The CUSTOMES MODULES include Lodgment; Data Entry; Goods Inspection/Enforcement, Valuation and Document Check, Risk Profiling, Cashiering, Release, Remissions, and Warehouse.
The TAX Modules include; Taxpayer Identification, Tax, Accounting, Audit, Reports/Notices/Certificates.
Statia noted, however, that since all of the modules were not implemented, the “TRIPS system was just tripping.”
The TAX chief said that the failure to implement all of the modules affected the entity to a large extent.
He explained, “In the olden days, it used to be a manual system and it worked up to a particular point. So you know for sure that if TRIPS is in place, the IT system would help you to do a lot of these things.
If you have the right IT software, half of your work is completed. You would be able to do proper audits and these things at the touch of a button you would be able to recognize what is wrong and what is right; whether a taxpayer has complied…”
The Tax Chief continued, “Unfortunately, you can’t do that with the present system and that has gone on for the last 10 years. That was probably one of the reasons why the GRA has been in such decay. It was in a state of decay.”
Statia added, “What I did know is instead of them using an entire TRIPS system, I said, ‘No. concentrate on the internal revenue modules.’ And we are going to go to the Automated System for Customs Data…That is what we are doing.”
The GRA Commissioner General said that the ASYCUDA system will cost just about US$2.5M.
As for TRIPS, he sought to stress that “We must get something out of what we have paid for so while we are moving to ASYCUDA for customs and we will keep (aspects of) TRIPS… In that way we would be able to turn up certain things faster…”

BILLIONS LOST
The Tax Reform Commission which was commissioned by the Granger administration had also flagged the Guyana Revenue Authority for the non-implementation of the TRIPS system.
The comments and findings of the Commission were also in sync with that of the Auditor General, Deodat Sharma in his annual reports.
With respect to the software available, the Commission was advised that the TRIPS system has the ability to receive and store Cargo Manifest electronically, track containers from departure to arrival ports and then to final release as well as on line and manual entry of declarations.
“We understand that although delivered, these relevant modules were never or only partly implemented by GRA for one reason or another. The revenue leakages, alone, from the non-implementation of these modules are in billions of dollars, and contribute to rampant corruption within the Customs Section of the Authority,” the Commission pointed out in its report.
It added too that the importers who engage in the under invoicing activities are known and are allegedly in full collusion with Customs brokers, and some unscrupulous former and present GRA officers.

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