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Collusion on tax waivers

Jan 06, 2025 Editorial, News

Editorial…

Kaieteur News- Chartered Accountant, Christopher Ram recently revisited the lopsided oil contract the Coalition Guyana signed with ExxonMobil and, not for the first time, he mentioned that in his recent book, former natural Resources Minister, Raphael Trotman, stated that Vice President, Bharrat Jagdeo and his PPP/C party were part of the deal.  Trotman in his book stated that in the lead-up to the National Assembly passing a law to grant ExxonMobil tax waivers, Jagdeo, then Leader of the Opposition, was secretly briefed and he agreed to the giveaways, which he would later criticise in the run-up to the March 2020 elections.

Back in 2019, Jagdeo. while being interviewed on 94.1 FM said these words, while commenting on the 2016 oil contract: “They (coalition) sold us out to the foreigners – the oil companies. Every time there is a find there, our people should be sad because nothing comes our way. We are going to renegotiate those contracts because that’s not what we had in mind. When we were in the early days, we were coaxing the people (ExxonMobil and partners) to go along. They (APNU+AFC) came into office (and met) 3 billion barrels of proven reserves and then gave up zero royalty, no taxes, no ring-fencing, no local content for these people to spend any money here.”

He continued: “Paying our people GY$72,000 a month when the foreigner is getting US$10,000. Bringing water from California to drink here. We are paying for all that. Landscaping – they wanna contract it to a company coming from abroad and the Trinidadians and others are just walking in not only in the oil sector but they are getting all the prime lands too… So that is why I got back into politics. I’m not prepared to see this happen; I have no desire to be President again.”

This newspaper has often shone the light on the billions in taxes this country waives to ExxonMobil as a consequence of the lopsided deal. Taxation is a touchy issue in Guyana for the PPP/C Government and the Opposition. When the discussion is about taxing the oil companies operating here, leaders in this government and opposition vanish.

Guyanese pay taxes and they want ExxonMobil to pay its fair share of taxes. The fly in the ointment is that the PPP/C Government is on the side of ExxonMobil with this one, and against the Guyanese people.  In America, the home of several oil giants, the sounds and sentiments are about the possible levying of taxes on windfall profits made by oil companies.

In Guyana, on the other hand, where there is no such native attachment to the oil companies, there is only silence and resistance on the government’s part when the challenge is made for ExxonMobil to pay its fair share of taxes due to the Guyanese treasury.

Recently, the folks in Irving, Texas, were gloating as they celebrated blockbuster profits. Guyana’s high-quality, low-cost oil contributed a goodly share to their profits. The irony is that while the Americans (and others) contemplate taxes on excess profits (so-called windfall taxes), Guyana’s leaders have ruled this out. It is no secret in Guyana, but the enraging reality is that ExxonMobil and partners are not paying one dime in taxes on its profits.

Meanwhile, when agitated citizens call for ExxonMobil to pay some taxes, its fair share, the company gets the PPP/C Government to go after those Guyanese daring to challenge its comforting and enriching nontax regime. The non-payment of taxes by ExxonMobil is not just an abomination, it is the rankest of rank injustices. Guyanese should be out in the streets to express their wrath at this thievery under contractual cover that haemorrhages our already thin national coffers. To think that Guyana’s new massa, ExxonMobil’s Alistair Routledge, could have the audacity and indecency to talk about the 2016 contract as the “best ever contract” for this country is the height of arrogance and insult. All Guyanese should be infuriated, just as how legions of Americans are. We are feeling the squeeze, so must ExxonMobil. The PPP/C Government must work tirelessly to get the company to pay its share of taxes.

(Collusion on tax waivers)

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