As part of Budget 2017, several measures were outlined to improve tax administration through the Guyana Revenue Authority (GRA); one being the revision of the Income Tax Act Chapter 81:01 to allow the authority to garnish funds from bank accounts held by taxpayers.
During his post-budget press conference on Monday, Opposition Leader; Bharrat Jagdeo expressed his disagreement with this measure.
“If we owe the GRA or the GRA now assesses or thinks that we owe them for any taxes, the GRA will have the power to go into our bank accounts now and take the money, garnish our money…anyone of you here, they feel you owe them, they don’t have to come after you anymore, they’ll go to the bank and take the money from your account. This is unbelievable, I never thought I’d witness this here today” Jagdeo said.
Finance Minister, Winston Jordan on Monday noted that this provision would assist to improve compliance with demands issued by the GRA for outstanding payments.
Other Tax Administration measures outlined includes; an Excise Stamp System which aims to minimize the smuggling of highdutiable excise products, the increase in the three years’ statute of limitations to five years and the removal of section of the VAT Act which allows a taxpayer to object to a decision by the Commissioner regarding an arrangement to settle outstanding VAT due, among others.
Additionally, Budget agencies will now be required to pay VAT on all goods and services, except those financed from the proceeds of a donor agency.
The provision whereby non-Residents are required to pay VAT and apply for a refund when they are leaving the country will be repealed.
A penalty will also be introduced for the late filing of Income Tax, Corporation tax and Property Tax Returns.
“I propose to increase late filing penalties to 10 percent (similar to VAT). A flat fee of $50,000 will be applied to each loss/deficit return submitted after the prescribed time” Jordan outlined.
To address the issue of employers failing to keep proper books and records, the penalties will be increased to $200,000 or five percent of the tax assessed, whichever is greater. Failure to present the records when requested will result in a $200,000 fine and/or six months imprisonment. Nonresident companies, which fail to keep relevant books and records in Guyana, thereby causing unnecessary delays during the audit will be subject to a fine of $1,000,000.
Failure to inform the GRA about the commencement of business will also see penalties.
Meanwhile, the penalty imposed for offenses committed against the Income Tax Act under the provisions of Section 109 to 111 would be increased from $15,000 to $100,000 to force voluntary compliance.
It is also proposed to impose a fee of $1,000 for the first TIN certificate and $5,000 for the reprinting of TIN certificates.
