Private Sector urges Govt. to raise tax threshold to $100,000

Apr 30, 2020 News

– remove mortgage, VAT on food items; defer utility bills payments; emergency funding for small businesses

The Private Sector Commission (PSC) which comprises a number of the biggest businesses in the country, has proposed a number of economic measures to cushion the impact of COVID-19.

Gerry Gouveia

In a letter released yesterday, addressed to Moses Nagamootoo, Chairman of the National Task Force – COVID-19, PSC recommended that the country take steps to immediately raise the threshold to accommodate no taxation for employees in vulnerable sectors that were sent off the job from $65,000 to $100,000 and the removal of mortgage interests and payments for the period.
According to the letter from PSC’s Chairman, Captain Gerry Gouveia, authorities should also move right away to reduce the spread at commercial banks- that is the difference between the lending rate and the savings rate of interest.
There should be a removal of the Value Added Tax (VAT) from all food items, detergents and all household, medical and other cleansers and essential services including data.
Government should also take steps to temporarily remove the requirement to pay Income and Corporation Taxes up front.
With regards to small businesses, there should be an emergency funding to reduce the impact.
PSC also would have taken note of the growing calls by hard hit households to have a relief on their electricity bills. It recommended an extension of the time to pay utility bills and hire purchase debts.
There should also a reduction of the Excise Taxes on fuel.
PSC also recommended that there be a 100% deduction of taxes for items given to the national effort; a rescheduling of loans and mortgages and a relaxing of overdraft facilities and of regulations to classify loan as non-performing.
Other measures include the removal taxes on personal protection equipment (masks, gowns, gloves etc.; the approval for hospitals to bring in ventilators without taxes and allowing labs to bring in test kits and PCR machines without taxes.
The Ministry of Finance, PSC said, should also consider offering the Guyana Bankers Association (GBA) a tax rebate in part of full for interest lost as a result of the banks lowering their interest rates.
There should also be a reduction in fuel prices by removing the tax component so that the public transportation can benefit also with a corresponding reduction on fares and utility companies should defer payments and/or reduce by 50%.
With regards to taxes, the PSC urged that measures be put into place by the Guyana Revenue Authority for the filing of Income and Corporation Taxes until September 30, 2020, provided that the current COVID-19 situation is brought under control by then.
There should also be incentives for the promotion of the use of technology and tax measures to lower material cost for sanitization and food.

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