Guyana tax to GDP falls to lowest in Latin America and Caribbean

Jun 03, 2025 News

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—Ram blames situation on govt’s reckless management of oil economy

Kaieteur News- Tax revenues as a share of GDP in Guyana fell in 2023 and the country now has the lowest tax-GDP ratio for the Latin America and Caribbean region, a new report by the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) has said.

According to the report, tax revenues in Latin America and the Caribbean (LAC) decreased as a share of GDP in 2023 amid a slowdown in economic activity in the region and a decline in global commodity prices. The report titled, Revenue Statistics in Latin America and the Caribbean 2025, released two weeks ago at the UN-ECLAC 37th Regional Fiscal Seminar in Santiago, Chile, shows that the average tax-to-GDP ratio in the LAC region was 21.3% in 2023.

This was 0.2 percentage points (p.p.) below the level in 2022 and slightly below the level prior to the COVID-19 pandemic (21.4% in 2019). Tax-to-GDP ratios in the LAC region, according to the report ranged from 11.6% in Guyana to 32.0% in Brazil in 2023. By comparison, the average tax-to-GDP ratio in OECD countries was 33.9% in 2023.

Between 2022 and 2023, the tax-to-GDP ratio fell in 14 of the 26 LAC countries included in the report. Chile and Peru observed the largest declines (of 3.2 p.p. and 2.1 p.p. respectively). In both cases, this was primarily due to lower income tax revenues, which resulted from the impact of lower commodity prices on the economy and high tax refunds and credits in 2023. According to the new report, the overall decline in tax revenues as a share of GDP in the LAC region was due to a fall in revenues from income taxes, notably among some of the main hydrocarbon and mineral producers.

In an invited comment on the report, Chartered Accountant, Christopher Ram said that the report confirms how recklessly the PPP/C has managed an oil economy. He said it also confirms Guyana’s oil delusion and paradox: the shameful distinction of having the lowest tax-to-GDP ratio in Latin America – just 11.6%, while boasting of being an oil powerhouse. It makes us look foolish.

“Before oil, even with the high level of tax evasion, Guyana collected taxes at a more normal rate of around 24% of GDP. With oil supposedly transforming our fortunes, the ratio has collapsed to 11.6%. Those who boast that we are all stupid do not want to admit that our GDP is bloated with oil profits to Exxon and company and barely touching our Treasury,” Ram who is an advocate for a better oil deal between Guyana and ExxonMobil said.

He told this newspaper that with the “headlamps in their eyes, government has refused to modernise our economic base, continuing to measure prosperity using inflated figures that disguise how little we receive. Worse, the Government pays the taxes for the same oil companies from the little we receive, issuing them tax certificates to claim credits in their home countries even as we pretend to collect revenue. With a guaranteed recovery of all their costs, the companies make profits approaching 70%, higher than any of the tech giants or other businesses.”

Robbery

Ram described the situation regarding Guyana’s tax collection as “that robber baron so well-known from our early school days – Walter Raleigh. We remember that he sailed to these shores searching for El Dorado, finding nothing, whatever he told the people back home. We freely surrender our offshore oil wealth to corporate raiders in ways that dishonor the memory of the Arawaks and Caribs, who never willingly gave up what was theirs.”

He bemoaned the fact that some of the country’s intellectuals defend the refusal to renegotiate the lopsided ExxonMobil contract as “sanctity of contract.”  This he said makes Raleigh looks like an amateur. “At least he failed to rob us. On the other hand, we are being robbed in broad daylight, and our politicians are so blinded that they want the country to be associated with their vessel – One Guyana. Walter Raleigh all over again.”

Tax and earnings

For 2023, the Government of Guyana (GoG) had to pay the combined sum of $306 billion in income taxes for ExxonMobil Guyana Limited and its Stabroek Block partners, Hess and CNOOC according to the companies’ audited financial statements, while for the same period Guyana earned $336 billion from its oil. Income tax revenues declined by 0.1% of GDP on average from a peak of 6.3% in 2022. Social security contributions increased by 0.1 p.p. in 2023 while revenues from taxes on goods and services remained unchanged as a share of GDP.

A decline in commodity prices in 2023 dragged down the LAC region’s revenues from non-renewable natural resources. Hydrocarbon-related revenues among the region’s ten biggest oil producers declined to 3.9% of GDP on average in 2023 (from 4.4% of GDP in 2022) while mining revenues declined to 0.59% of GDP (from 0.74% of GDP in 2022). The report estimates that revenues from hydrocarbons and mining decreased further in 2024, to 3.2% of GDP and 0.5% of GDP, respectively. For the first time, the 2025 edition of Revenue Statistics in Latin America and the Caribbean presents harmonised data on non-tax revenues, such as rents and royalties, interest and dividends received by the government, and public sales of goods and services.

The report shows that non-tax revenues at the central government level for 22 LAC countries averaged 3.1% of GDP in 2023, ranging from 0.4% in Peru to 11.6% of GDP in Cuba. Between 2019 and 2023, non-tax revenues declined by 0.4 p.p. on average across the LAC region, albeit with strong year-on-year variations over this period, including a decline of 0.7 p.p. between 2022 and 2023.
Revenue Statistics in Latin America and the Caribbean 2025 is a joint publication by the Inter-American Center of Tax Administrations (CIAT), the Inter-American Development Bank (IDB), the United Nations Economic Commission for Latin America and the Caribbean (UN-ECLAC), and the Organisation for Economic Co-operation and Development (OECD) Centre for Tax Policy and Administration and Development Centre.

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