…Statia urges compliance

THE contribution of taxes from the self-employed to the tax revenues does not seem to represent what can be considered a fair contribution to total taxes collected, Commissioner-General Guyana Revenue Authority (GRA) Godfrey Statia said on Thursday.
At a luncheon hosted by the Guyana Manufacturing and Services Association (GMSA), Statia said tax- payers who conduct trade and commerce, agriculture and fishing, and professions and vocations usually operate in the cash and “are reluctant to maintain records, making them the most hard-to-tax group in the country.”

He said too that though taxpayers’ resistance to the payment of taxes in many instances may be motivated by the principle that every economic sacrifice must give an economic benefit in return, “these persons reap the benefits in the form of public service, facilities and infrastructure built by government such as highways, schools, bridges, hospitals, health centres, subsidised food, clothing and shelter, and make little or no contributions to the tax pool.”

The commissioner-general reminded attendees that the Authority’s role is to ensure that each taxpayer pays his rightful tax, the tax laws are administered fairly and consistently, and at the same time strive for efficiency in tax collection. The country’s tax system allows for self-assessment and voluntary compliance and it is estimated that 98 per cent of all taxes collected by the Authority is through voluntary compliance.
Though not its only role, Statia said too that it is important for the taxpaying public to view taxation as an investment in one’s country and its development and progress. Taxes he said must be seen as a social contract between the taxpayer, the government and the Authority.

“The Authority only administers the laws. Its mission is to promote compliance with Guyana’s tax, trade and border laws and regulations through education, quality of service and responsible enforcement, thereby contributing to the economic and social well-being of the people of Guyana,” said Statia, who noted that GRA’s goal is to provide the best possible service at an affordable cost, be fair and respectful to the tax-paying public, manage its resources effectively and economically and be responsive and committed to improvement of its service.

Meanwhile, as part of its mandate, the GRA ensures that taxpayers pay their rightful tax, the tax laws are administered fairly and consistently, and at the same time strive for efficiency in tax collection, said Statia. He noted that without a proper functioning Information Technology (IT) system, the aforementioned cannot be achieved. “An examination of the Total Revenue Integrated Processing System (TRIPS) revealed that despite the outlay of millions of U.S. dollars from 2013 to 2016 to bring the archaic TRIPS1 System up to date by the introduction of an overlay of TRIPS2, not one single module was delivered. Furthermore, many of the modules paid for in TRIPS1 in 2007 were never even delivered,” he disclosed.

Additionally, discussions on the matter were held with the Crown Agents and it was decided that all work on the Customs modules must cease, all focus must be placed on the completion of the Internal Revenue Modules inclusive of e-filing services with clear delivery dates and that all additional payments be put on hold until the modules have been delivered.

The commissioner-general said simultaneously, the GRA began discussions with the United Nations Conference on Trade and Development (UNCTAD) on the introduction of the Automated System for Customs Data (ASYCUDA) single-window system. The ASYCUDA is an integrated customs management system for international trade and transport operations in a modern automated environment which allows for customs administrations and the trade community to comply with international standards when fulfilling import, export and transit-related procedures.

Through its ASYCUDA Programme, GRA hopes to modernise customs operations and improve revenue collection, facilitate trade efficiency and competitiveness by substantially reducing transaction time and costs, improve security by streamlining procedures of cargo control, transit of goods and clearance of goods, reduce corruption by enhancing the transparency of transactions, and promote sustainable development by cutting down on the use of paper, through the use of electronic transactions and documents.
“I am happy to report that the agreement with UNCTAD has been signed, payment has been effected, the team chosen, training will shortly commence, and a pilot project will commence shortly thereafter at the John Fernandes wharf,” announced Statia, who said testing has begun for the remaining TRIPS modules. He has been advised and assured by his IT staff that GRA should be in a position to offer e-services, including e-filing in time for the 2018 filing season.

Excise stamp on cigarette
Additionally, discussions have re-commenced with the Canadian Bank Note company with the aim of introducing the Stamp System, thereby minimising revenue leakages through the smuggling of alcohol and tobacco. “I am happy to report that this programme will be introduced by the end of October 2017 with a reduction of project costs of nearly US$1M and the programme extended to 2024 instead of 2022,” said Statia. The GRA boss said too that in recognising the need to improve efficiency and reduce downtime, the GRA has re-introduced the Post Clearance Audit, which allows for containers of reputable importers to be done on site, and introduced the Trusted Trader programme, whereby after meeting certain criteria, containers are expeditiously cleared, thereby reducing demurrage fees and downtime.
“After deliberations with wharf owners, and looking at alternative sites, a MoU was signed with the Guyana National Industrial Company Inc. (GNIC) for the location of both a fixed and a movable scanner on its premises.” That site is expected to be completed by the end of this year and will house GRA’s movable scanner, while the fixed scanner will arrive in Guyana early next year through a grant from the People’s Republic of China.
“As a prelude to ASYCUDA, requests are now being made for advance electronic manifests, thereby allowing profiling prior to ports and allowing for easier and faster clearing of containers,” said Statia.

He said it is known that 20 per cent of taxpayers contribute 80 per cent of revenue collected and in an effort to prioritise revenue collection, a conscious decision was made to establish a Large Taxpayers Unit. After the completion of the appropriate training programme by the Caribbean Regional Technical Assistance (CARTAC), this unit will be a reality in November 2017 and will allow for the elite group of taxpayers a one-stop shop for their taxation needs, while at the same time maximising revenue collection through improved audit, review and compliance methods.

“In the area of oil and gas, based on a study conducted by the OTA, the organisational chart has been completed; staff requirements and job specifications identified and budgeted for, with training set to commence by December 31 of this year,” stated Statia.
Additionally, he noted that funds were procured through the Inter-American Development Bank (IDB) earlier this year and expressions of interest drafted to facilitate the implementation of an initial five-year strategic plan, which will guide its future. The consulting firm for the project should be chosen by December 31, 2017, thereby allowing for its early completion in 2018, he said.