— Ram urges GGDMA

CHARTERED Accountant Christopher Ram has advised the Guyana Gold and Diamond Miners Association (GGDMA) to treat tributors as regular employees or independent contractors, so

as to avoid the 20 per cent tributors’ tax imposed by Government.
Miners on Friday, during a specially convened meeting organised by the GGDMA during which Ram made a special appearance, called for tributors to be provided with risk allowances as they bemoaned the increase in the tributors’ tax from 10 per cent to 20 per cent.
In his presentation, Ram, from the initial stage, pointed out that there is absolutely no definition of who is a tributor.

“Are these people genuinely tributors, or are they seasonal workers? It may very well be that’s what they are,” he said.
Ram said based on his understanding from discussions with the GGDMA, many of the tributors have a fixed level of remuneration and may very well be considered to be employees.
“Instead of treating them as tributors, treat them as employed persons, they will get their (personal) allowances like everybody else does and pay tax on the difference,” he opined.

Ram explained that if a tributor is defined and determined to be an employee earning $60, 000 a month, under the Income Tax Act, that person will now be required to pay Income Tax or Pay As You Earn (PAYE), given that the threshold is now fixed at $60, 000 or one-third of the gross salary, whichever is greater.
However, if that person is classified as a tributor, he or she will then have to pay 20 per cent on the $60, 000 or $12, 000. If an employee earns more than $60, 000, say for example $70,000, that employee would pay tax on the difference, in this case, on the remaining $10, 000.

However, the chartered accountant noted that Finance Minister Winston Jordan has inserted a proviso into the Income Tax measures paving the way for tributors to benefit from a personal allowance of 720, 0000 per annum.
In this case, Ram opined that many tributors would have to be refunded by the Guyana Revenue Authority (GRA), because many of them would not have benefited from their $720, 000 annual personal allowances.

In updating the miners on the new personal income tax rate, the chartered accountant pointed out that it has been reduced to 28 per cent from a high of 30 per cent for persons earning $180, 000 or less per month. However, if a person earns more than $180, 000, he or she will be required to pay 40 per cent on the remainder.
Additionally, Ram suggested that tributors can be considered independent contractors. In this case, he said, they will be required to pay a contractors’ tax of two per cent.
“Treat them as independent contractors, pay them (GRA) two per cent. Two per cent of $70, 000 is $1, 400,” he said.

According to Ram, if there is nothing stopping miners from treating tributors as independent contractors, then they can radically change the intention of the Revenue Authority and by extension, Government.
The issues surrounding the Tributors Tax are among key issues that must be raised when GGDMA meets with the Revenue Authority.
Describing tributors as the backbone of the mining industry, Glynis Beaton, who was there representing a mining company, contended that tributors should be given a risk allowance.
“This is a high-risk job,” she emphasised, noting that the proposal should be up for discussion when the GDDMA meets with the GRA.
“And whenever you talk with GRA it must be documented, when the officers change the interpretation of the laws changes,’ she added.
Beaton’s contribution was met with loud rounds of applause.