Low tax returns

May 09, 2026 Editorial, News

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(Kaieteur News) – Guyana’s oil wealth is growing at a breathtaking pace. Contracts are flowing, and government officials continue to boast that the country is now among the fastest-growing economies in the world. Yet, beneath the glitter of oil prosperity lies a deeply troubling reality: Guyana is receiving one of the smallest shares of revenue from its own economy anywhere in Latin America and the Caribbean.

The latest report from the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) should alarm every citizen. According to the report, Guyana recorded the lowest tax-to-GDP ratio in the entire region at a mere 9.2 percent in 2024. The regional average stands at 21.7 percent. Brazil collects 33.7 percent. Even countries with stagnant economies and fewer natural resources are extracting more revenue from their economies than Guyana is from its booming oil sector.

The report explained that Guyana’s tax burden declined because economic growth, driven heavily by oil production, is outpacing tax revenues. In simple language, the country is producing extraordinary wealth, but the State is collecting only a tiny fraction of it. The oil economy is expanding faster than the government’s ability, or perhaps willingness, to secure a fair share for the people.

This is precisely what critics of the ExxonMobil Production Sharing Agreement warned about from the beginning. Guyana signed away vast petroleum resources under terms that continue to favour the oil companies far more than the citizens who own the resource. Today, the evidence is undeniable. The economy is exploding, but the public purse remains disproportionately small.

What makes the situation even more disturbing is the government’s continued refusal to renegotiate the oil contract. President Irfaan recently declared that the administration is “not budging” on changes to Exxon’s agreement. Meanwhile, international reports now confirm what ordinary Guyanese already sense: the country is not maximizing the benefits from its oil wealth.

The government will argue that billions are flowing into infrastructure, housing, healthcare and education. And yes, projects are being rolled out at an unprecedented pace. But development spending alone cannot mask the structural weakness exposed by the ECLAC findings. A country with one of the fastest-growing economies on Earth should not simultaneously hold the embarrassing distinction of having the lowest tax-to-GDP ratio in the region.

This contradiction points to a deeper problem: Guyana’s oil economy is becoming an enclave economy. Wealth is being generated, but a disproportionate amount is escaping through profit repatriation, generous concessions, tax waivers and contractual limitations. The ordinary citizen sees cranes, pipelines and billion-dollar announcements, yet still struggles with high food prices, poor drainage, blackouts, inadequate healthcare and rising inequality.

The ECLAC report also exposes another uncomfortable truth. Countries that implemented deliberate tax reforms increased their revenues significantly. Barbados, Brazil, Cuba and Antigua all saw improvements after making policy changes. Guyana, however, appears trapped in a mindset that treats oil companies as untouchable benefactors rather than corporate entities operating for profit.

The danger here is not only economic; it is political and generational. Oil wealth can disappear faster than it arrives. Commodity prices fluctuate. Global energy transitions are accelerating. The same report noted declining hydrocarbon revenues across several producing nations because of falling prices and production changes. If Guyana fails to secure stronger fiscal returns now, future generations may inherit depleted reserves with insufficient long-term benefits to show for it.

There is also the issue of accountability. The government continues to celebrate growth figures while avoiding meaningful national debate about revenue fairness. GDP growth sounds impressive in speeches and international conferences, but GDP alone does not feed citizens or build resilient societies. What matters is how much of that wealth remains in national hands and how effectively it is transformed into sustainable prosperity.

The question every Guyanese must now ask is simple: how can a nation swimming in oil still collect less revenue relative to its economy than almost every country in the region?

This country cannot afford to be intoxicated by headline growth figures while ignoring the mathematics of national benefit. Guyana risks becoming the classic example of resource wealth without equitable return. We are watching billions flow through the economy while the State struggles to capture sufficient value from the very resource driving the boom.

Real transformation means securing fair revenue, building strong institutions, reducing inequality and ensuring that the nation, not foreign corporations

becoming the primary beneficiary of its natural resources.

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• ECLAC, Editorial, President Irfaan, tax returns

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