Taxes collected by Bahamas on Guyana’s oil will soon outweigh our total earnings – Chris Ram

Feb 23, 2025 News

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…As Gov’t remains locked in “unholy alliance” with ExxonMobil

Kaieteur News- As the Government of Guyana (GoG) remains locked in an “unholy alliance” with American oil major, ExxonMobil, the Bahamas is set to benefit from tax payments that will soon outweigh the country’s total profit and royalty earnings from the sector.

This is according to Chartered Accountant and prominent Attorney-at-Law, Christopher Ram. In his most recent column published by the Stabroek News, the lawyer weighed into the recent revelation that ExxonMobil is paying taxes to the Bahamas and none to Guyana where it generates massive profits.

Ram argues that this development would almost be comical were it not so devastatingly costly to Guyana. To put the situation into context for readers, the columnist explained, “The Bahamas, a country with only sand, sea and shells, will soon generate more tax revenue from Guyana’s oil industry than Guyana itself!!”

He pointed out that Guyana’s government has refused to exercise its sovereign right and power to tax all income earned in Guyana. This is so as the 2016 Production Sharing Agreement (PSA) with Exxon and partners waives the payment of corporate and other tax payments to the country.

In the meantime, Ram in his explosive piece noted, “The Bahamas’ initiative-taking adoption of the OECD’s Pillar Two framework exposes Guyana’s fiscal negligence and its leaders’ spineless subservience to ExxonMobil and multinational interests. The framework ensures that multinational enterprises pay a minimum tax of 15%.”

About two weeks ago, Kaieteur News reported that the Bahamas enacted the Domestic Minimum Top-Up Tax Act, 2024 (the Act) on 28 November 2024. The Act introduces a Domestic Minimum Top-Up Tax (DMTT) in line with the Organisation for Economic Cooperation and Development’s (OECD) Pillar Two Framework. The objectives of the OECD’s framework are to implement a global minimum tax at an effective rate of 15% on the income arising from multinational entities in each jurisdiction in which they operate.

With the new tax arrangements in place by the Bahamas, Exxon is there required to pay a corporate tax of 15% to the country since EMGL, formerly Esso Exploration and Protection Guyana Limited (EEPL) is a company registered in the Bahamas with ExxonMobil Global Holding Investment B.V. being the 100 percent owner of that company.

Ram believes that Guyana’s refusal to adopt the OECD framework reveals an uncomfortable truth that the Guyana government has actively given up billions in revenue rather than even suggesting that ExxonMobil and its partners HESS and CNOOC should pay taxes on its hefty profits from Guyana.

He said, “No one should be fooled that Guyana’s refusal to join the OECD framework is an oversight -it is a manifestation of the country’s leadership kowtowing to Exxon and HESS over the interest of their own people. They know that if they sign on, they must commit self-styled heresy by charging tax on Exxon.”

The lawyer argued that this is not government’s only show of loyalty to Exxon as they have also refused to utilise the renegotiation clause in the 2016 Petroleum Agreement, to seek better fiscal terms. Ram noted that its refusal in this regard “stands as a glaring example of fiscal surrender, with Guyana not only waiving its right to collect taxes but also reimbursing ExxonMobil for its tax obligations and providing receipts for taxes EXXON and HESS, they never actually paid.”

The Chartered Accountant estimates that Guyana has already given up about US$3B in taxes which the oil companies should have paid since 2020. “To put this in perspective, The Bahamas anticipates generating approximately $140 million annually through its new tax measures, applied across its entire economy. Given the vast scale of ExxonMobil’s operations in Guyana, our potential revenue under the same framework would dwarf this figure multiple times over,” he explained.

Ram concluded that this is not about legal constraints or contractual obligations, but a government that “has chosen to protect ExxonMobil from taxation rather than safeguard the financial future of its own people.”

Moreover, the lawyer said, “To describe this as fiscal negligence is too kind. It constitutes a deliberate betrayal of national interests that transforms Guyana’s oil blessing into a case study of corporate colonialism in the 21st century.”

(Taxes collected by Bahamas on Guyana’s oil will soon outweigh our total earnings – Chris Ram)

(Taxes collected by Bahamas)

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• Bahamas, ExxonMobil, Ram, taxes, unholy

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