Latest update March 20th, 2025 5:10 AM
Latest News
- Guyana’s oil growth boosting regional economies– CDB Director of Economics
- Suspected outbreak of Hand, Foot and Mouth Disease in Region Four
- Israel launches first ground offensive since Gaza ceasefire collapse
- Sod turned for $665M expansion of St. Stanislaus College
- Pensioner jailed for raping child
Duty free fuel has been extremely susceptible to abuse – country losing billions of dollars annually – Tax Chief
By Kiana Wilburg
Of all the areas the Guyana Revenue Authority (GRA) must monitor to prevent acts of corruption, fuel remains the most troublesome.
According to GRA’s Commissioner General, Godfrey Statia, 30 percent of the fuel imports for Guyana are duty free. Statia said that these go to various companies in the natural resources sector, government agencies, among others.
The tax chief noted that given the quantity of fuel imports that is subject to tax remissions, it is often abused.
Statia said that almost daily, a racket involving the misuse of duty free fuel can be uncovered. In fact, Kaieteur News recently learnt of one prominent agency linked to allegations of fuel misuse.
Statia declined to divulge specifics, but confirmed that the GRA is in receipt of reports on this matter and an investigation has been initiated.
GRA Commissioner General, Godfrey Statia
The Commissioner General noted that the misuse of duty free fuel has been an uphill battle for the authority, but mechanisms are being put in place to plug loopholes, where found. He noted that some of GRA’s systems of control would have stemmed from the findings made by the Tax Reform Commission, of which he was part.
The Commission pointed out that based on the revenue losses on fuel exemptions for 2014 and 2015 alone, government needs to rethink its policy on waivers.
The Commission noted that for the two years, the customs value of petroleum products imported was some $117B and $70B respectively. The total value of exemptions from Import Duty, Excise Tax and Value-Added Tax amounted to $23B and $22B in 2014 and 2015, respectively.
The Commission said it was unable to determine the exact sources or the beneficiaries of these exemptions, but it was provided with other exemption data arising from Investment Development Agreements (IDAs) which are equally worrying. In this regard, it noted that taxes exempted for 2014 and 2015 were $63B and $92B, as it relates to IDAs. Included in these figures are exemptions for Ministries and Government Departments to the tune of $4.4B and $19.5B respectively.
The Commission also looked at tax exemptions for fuel for certain sectors from the period 2013 to 2015. It was noted that for 2015, tax exemptions for companies and businesses amounted to $56.7B. The major sectors that benefitted included: Telecommunications, Mining, Petroleum Exploration and Manufacturing.
Given the aforementioned, the Tax Reform Committee recommended that conditional subsidies should be significantly reduced if not eliminated over a five-year period.
The Commission said, too, that losses from the granting of IDAs for the years 2013 to 2015 are a cause for concern. It said, “Many sectors receive concessions far more than they contribute in taxes and while this fact itself does not per se justify the abolition or the withdrawal of the concessions, it is clear that an urgent review is required.”
In this regard, the Committee recommended that there be a review of the investment priority categories for fuel exemptions and that clearer parameters and guidelines be established for the entering into of Investment Development Agreements, so as to reduce the discretionary powers of the Minister.
The Commission said that IDAs have been granted to long-established, profitable companies, and this should have been changed.
The Commission also called for the introduction of a post-audit system for concessions granted, including the posting of a bond/guarantee to ensure that commitments are met. It called, too, for a requirement for the periodic audit and publication of reports of tax holidays granted and investment agreements entered into.
Similar Articles
THE BLUNT OF THE DAY
Sports
Features/Columnists
No immigrant should feel safe in America today
Peeping Tom… Kaieteur News- There was a time when an illegal immigrant in America could live in the shadows with some... more
If Guyana’s President Ali is the “Zelensky of the Caribbean”, who is the Putin?
Antigua and Barbuda’s Ambassador to the US and the OAS, Ronald Sanders By Sir Ronald Sanders Kaieteur News- In the latest... more
Weekend Cartoon
