Professor Ramdas’ analysis that Guyana is losing about US$62M is correct

Jun 05, 2021 Letters

DEAR EDITOR,

Distinguished Retired Economics and Business Professor, Dr. Ganga Ramdas, of the Oil and Gas Governance Network (OGGN), asserts that Guyana is losing an approximate US$62 million annually due to Exxon not paying taxes, as other companies do. Many newspapers and commentators such as Guyana icon, Christopher Ram, have lamented this sad state of affairs of Exxon not actually paying taxes but receiving a Tax Certificate from Government that they have paid taxes. In response, Mr. J.C. Bhagwandin, a Financial & Economic Analyst and Adjunct Instructor at Texila American University, says, “The oil deal was designed to cater for the nature of the industry.” This argument evades the issue of oil companies not paying taxes. In addition, this is an unusual oil deal not common in the oil industry anywhere in the world. This deal came about because we have dullards in successive governments in Guyana.
Mr. Bhagwandin does not disagree with Dr. Ramdas’ assertion on the tax loss to Guyana. Rather than providing a sensible refutation of what amount is being lost, the financial analyst appears to have chosen to be an apologist and apparent spokesman for the oil companies and Guyana Government unwillingness to renegotiate the oil contract. Notice that Exxon never says anything in its defense, that it is always the government or folks aligned with the government who make excuses and act as PR spokesmen for the oil companies. By not paying taxes, the oil companies are getting a free ride on the backs of other businesses and taxpayers who have to pay taxes as they go. Business taxes pay for much of our infrastructure and government services, which are used by the oil companies. There is no doubt about that.
Mr. Bhagwandin’s angle is similar to the government’s argument that Guyana will make lots of money in the long run if we will “drill baby drill” and to hell with environmental concerns. What’s a little flaring, don’t bother that the contract is the worst in the world, don’t try to renegotiate, we got it good! That’s what they say. Tell that to the poor people in our poor country now reeling from devastating floods. Our current flood disasters make the case that we need the oil money to build massive sea defense and infrastructure to avoid being drowned by unusual flooding as we are facing now. Most of our streets in Guyana need paving. The mud roads have been washed away. Every type of infrastructure needs modernisation and we need expansion of services – water, electricity, Internet services, hospitals, roads, ferries, schools, canals need to be dug and kept maintained on a sustainable basis, etc. Everything needs fixing and modernisation, and we need lots of money to do it.
We cannot continue to be a rich nation of poor people as President Ali said. Mr. Bhagwandin would do a service to the poor, huddled masses yearning to be rich if he is on the side of the working poor, rather than being a point man for the oil interests and a government unwilling to renegotiate the oil contact as was promised during the election. That’s a “promise made, promise not kept.” The potential to make money in the future, providing there is no oil spill or other oil related disaster, does not negate Dr. Ramdas’ article that oil companies are not paying taxes on the billions of US dollars that they make in Guyana due to an unfair contract. We must change this! We must renegotiate now!

Sincerely,
Dr. Jerry Jailall

Discover more from Kaieteur News

Subscribe to get the latest posts sent to your email.

Latest News