Election saga, ongoing pandemic among reasons for GRA’s low tax collection

The Guyana Revenue Authority (GRA) received some $3.7 billion in taxes for the year 2020, representing an overall performance rate of 101.76 per cent.

The statistics was provided in the 2020 Auditor General’s report, which was laid in the National Assembly on Monday, by Senior Minister in the Office of the President with responsibility for finance, Dr. Ashni Singh, M.P.

The report shows that the collection of customs and trade taxes have been declining over the past three years. In 2020, the performance rate for customs and trade taxes was at 94.04 per cent, compared to 100.9 per cent in 2019.

GRA said its corporation taxes fell by 11.1 per cent, since there was a slowdown in business activities due to the prolonged elections episode and the ongoing Covid-19 pandemic.

The tax authority noted that its internal revenue collections have been consistently surpassing the budgeted amounts for the last three years.

A shortfall was also recorded in the collection of Value Added Tax (VAT) for the same period. The record shows a deterioration of 13.17 per cent over the prior year and reflected an overall shortfall of 1.06 per cent against the authority’s budgeted amounts.

It must be noted however, that effective March 26, 2020, the authority zero-rated VAT on all medical supplies for the testing, prevention and treatment of Covid-19.

Further, the report said some $21.3 billion in revenue collections was paid into the consolidated fund, even though it projected to generate about $22.6 billion from customs duties, trade and other taxes, fees, fines and licences in 2020. The amount represents a negative variance of six per cent equivalent to $1.3 billion. Notwithstanding the negative performance, there were increases in the collections for four of the 11 tax types, totalling $26.580 million.