Chief Justice declares GRA’s increase of Excise Taxes on remigrants’ vehicles unlawful

Chief Justice Roxane George Monday declared that the Guyana Revenue Authority (GRA) has been unlawfully imposing a 30% excise tax on vehicles imported by remigrants. The decision follows a legal challenge brought by Aditya Basdeo, a remigrant affected by the increased tax rate.

Since July 2023, the GRA raised excise taxes from 10% to 30% on vehicles with engines larger than 3,000cc. Basdeo, who imported a 2023 Toyota Landcruiser under the duty-free concessions available to remigrants, was required to pay nearly $4,600,000 in excise taxes—significantly higher than the $1,500,000 he expected under the original 10% rate.

Basdeo’s attorney, Siand Dhurjon, wrote to the GRA on April 15, 2024, contesting the increased tax rate. However, the GRA did not respond, leading Basdeo to file a lawsuit on May 28, 2024.

Last week, GRA Deputy Commissioner Gavin Low defended the agency’s actions, citing regulations introduced on July 10, 2023, which purportedly tripled the excise tax rates for vehicles over 3,000cc and doubled them for vehicles between 1,999cc and 3,000cc.

In court, GRA’s counsel, Ms. Nicklin Belgrave, acknowledged a critical oversight: the new regulations had not been duly enacted, as they were not published in the Official Gazette or tabled in the National Assembly. This oversight rendered the 30% tax rate unauthorised and illegal.

Chief Justice George granted all orders requested by Basdeo’s legal team, including quashing the 30% tax assessment and mandating the GRA to apply the correct 10% rate. The court also ordered the immediate release of Basdeo’s Landcruiser upon payment of the proper excise tax, and required the GRA to cover the vehicle’s storage costs and Basdeo’s legal fees.

During the proceedings, evidence surfaced that the GRA had inconsistently applied the 30% rate, with some remigrants still being charged the original 10% rate. The Chief Justice remarked that the GRA must rectify this situation by informing all affected taxpayers of the error and issuing refunds where necessary.

Commenting on the ruling, Dhurjon emphasized that the Excise Act and its regulations cap the excise tax at 10% and accused the GRA of illegally overcharging remigrants by hundreds of millions of dollars over the past year. He encouraged all affected remigrants to seek refunds.

Remigrant tax concessions allow Guyanese returning after five years abroad to import personal effects and vehicles duty-free, subject only to excise taxes. The incorrect application of these taxes has serious financial implications, as the full tax burden on a high-value vehicle like a Landcruiser can reach approximately $90,000,000, depending on the vehicle’s value.