VAT,  Capital Gains Tax (Amendment) Bills passed

GINA, GUYANA, Thursday, January, 5, 2016
The Value-Added Tax (Amendment) Bill 2016 was today passed by the National Assembly.
Minister of Finance Winston Jordan, who presented the Bill, said it seeks to amend the Value Added Tax (VAT) since the lack of resource capability for an effective VAT system has led to abuse of taxpayers’  monies by non-tax payers and non-compliant persons.
Opposition Member of Parliament (MP) Priya Manickchand said the amendment regarding not refunding persons who visit the country is ridiculous.
Manickchand said she would advise that they have that section suspended rather than repealed, “Because we heard from the Tourism Ministry that plenty persons are returning to Guyana and when they return they should be refunded  their taxes.”

Members of the National Assembly at the January 5, 2017 Sitting

The MP then directed her attention to Sections 33, 35 and 65 (amendments) that look at extending the limitation period. “I would say that as a nation GRA (Guyana Revenue Authority) should be strengthened to do what they should do and not have the taxpayer have something hanging over his/ her head due to poor governance.”

Manickchand recommended to the government that it enhance the resources at GRA to better address the issues and not have this “lazy piece of amendment that shows we are lazy.”
Manickchand further voiced her concerns over Sections 51, 45:1 of the amendment. She said that Section 51 seeks to allow GRA to access people’s bank accounts without a court order. Manickchand emphasised that this is of great concern to her since there should be a process with regard redeeming funds from a taxpayer and “no office should have power to do this.”
She added that removing the proviso for persons to not travel when they owe tax is also absurd. “We should endeavour to give the citizens a hearing before having their rights infringed on; everyone should be able to travel without paying their taxes.”
The MP also criticised the government for permitting the Director General of GRA to block anyone from travelling out of the country whom he suspects owes taxes.
The Opposition MP was supported by her colleague, Anil Nandlall who contended that the amendments have devastating consequences for the citizens of the country. 
“The freedom to enter and leave Guyana is guaranteed as a fundamental right of every citizen, so why would a government want to resort to court to stop a person from travelling?”
Jordan in response noted that the opposition has a different interpretation of the entire VAT amendment system. He rhetorically questioned “Who are we going after? Are we going after those persons whose taxes are not up to date?”
To these he answered that the system is actually going after the big “crooks” who are covering up their taxes. The Minister exclaimed that “all of us who pay our taxes are force to pay more for those who don’t pay, so the burdened tax payers have asked us to say enough is enough?
The Minister said that his government will strengthen the armoury of the GRA to ensure it goes after all those who are tricking the system.
“We don’t want to prevent anyone from travelling, we are targeting those cheating the taxes.”
Minister Jordan said that the VAT revenues are collected and passed over to the government and therefore deleting the proviso in Section 45:1 provides the Commissioner General with reasonable ground that he may issue a certificate of particulars of the tax due to prevent the person from travelling.
The Minister concluded that this act of the government is to take the nation forward.
Meanwhile, in relation to the Capital Gains Tax (Amendment) Bill 2016 Opposition MP Neendkumar said this Bill is strenuous on Guyanese since the ordinary rice farmers are already contemplating what would be the tax for their sales.
“We are suspicious of what would be the devaluation price one would have to pay. Is there a hidden agenda to drag out more revenue from our citizens who are already pressured?” the MP asked.
He suggested a decrease in the rate of the capital gains tax be applied instead. He added that “on behalf of all citizens this amendment should be made public for transparency.”
Opposition MP Adrian Anamayah then rose to support his colleague noting that “it seems like the government seems to do something good for the people, but there is a backlash.”
Anamayah pointed out that he sees the amendment as a measure to revive the real estate market has crashed. He said that if this is meant to stimulate that real estate industry then it should be lower. He added that in other countries there is little to no capital gains and Guyana should adopt that method. “Capital gains is seen as a disincentive to an economy.”
Minister Jordan again responding to the Opposition Members’ statement declared that “we can safely say this is a measure to put money in people’s pocket, there is no hidden agenda, this is as straight as you can get it.”
Addressing MP Anamayah’s request to have a lower capital gains, Minister Jordan pointed out that those jurisdiction that have no capital gains tax have other taxes that provide for that. “So the comparison with other countries is not applicable unless we likened the tax margin on regimes.”
Both Bills were read the third time after which they were passed.
The passage of these two Bills and two others earlier are among 15 that have to be passed to ensure the budget measures are made into law.
By: Ranetta La Fleur