Extend the amnesty

Sep 27, 2018 Features / Columnists, Peeping Tom

The Commissioner General of the Guyana Revenue Authority should reconsider his decision not to extend the tax amnesty which was granted earlier this year and which has so far raked in more than five billion dollars in additional revenues for the government. The rationale provided by the Commissioner General is reasonable. He has said that tax amnesties are usually granted for a fixed period. While this is accepted it does not preclude him extending it, especially if the objectives were not met. In announcing the amnesty, the Minister of Finance outlined that it was applicable to all delinquent taxpayers – corporate and individual. The amnesty, he said, would run from January 1, 2018 through September 30, 2018.
Taxpayers who filed and paid all principal taxes on or before June 30, 2018 would benefit from a waiver of all interest and penalties, while those who filed and paid between July 1, 2018 and September 30, 2018 would have 50 percent of interest and penalties waived. The amnesty was granted on the condition that taxpayers filed true and correct returns. The Commissioner General in comments broadcast on Newsroom, indicated that while five billion dollars was collected, there was not a large number of taxpayers who applied for the amnesty but those who did, paid large sums. In other words, it was only a small number of persons who benefitted and most likely, judging from the Commissioner General’s comments, mainly business firms since this is the category likely to pay large sums. It is therefore respectfully submitted that the objectives of the amnesty have not yet been met; there was no widespread response from individual taxpayers. This may have been because many ordinary taxpayers who are delinquent may not have known about the amnesty or how to go about it or because of the need for additional time to get their documentation in order.
Either way, the original objective was not met and the Commissioner General and the Minister of Finance should consider extending the amnesty to the end of the year. If a small number of taxpayers have paid five billion dollars then there is no reason why in the remaining three months of the year and with an extension and a better public relations campaign about the amnesty, another few billion cannot be collected. Taxation should be equitable and so too should amnesties. If the amnesty has so far benefitted only a small number of taxpayers who paid large sums, then the amnesty has not yet been equitable and consideration should be given to extending it. There is another reason why this is so. The opposition has cast suspicion over the decision to grant the tax amnesty by speculating that it may have been intended to benefit certain individuals and firms. The Leader of the Opposition has questioned the amnesty. He was quoted as saying, “Why now? Why not from the very beginning of their term? Is it that there are a few companies that they know of, who have large outstanding interest and penalties that would accrue to them and they’re trying to help those companies by giving them a 100 per cent write-off on all interest and penalties?” Jagdeo questioned. “Is it that this is a deal in the making? Because if people have taxes outstanding, and they have interest to pay, then this government likes to believe it is fair, then the people should pay their interest in taxes that were outstanding for a while? This smacks of personal deals.”
The government denied the suggestions of a personal deal saying that there was no corruption involved in the decision and that the Opposition Leader was misleading the public.
Since we are now being told that only a small number of taxpayers utilized the amnesty but substantial sums were paid, it does suggest that the majority of those who benefitted were rich. The Commissioner General and the Minister of Finance may therefore wish to seriously consider tailoring a new phase of the amnesty specifically to target small individual taxpayers and firms, without closing the door on the large taxpayers.
Since the Commissioner General has announced how much was collected during the amnesty, he may wish to assuage the concerns of the Opposition Leader by pointing out the total number of individual and corporate taxpayers who benefitted and the value of the penalties and interest waived.

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