The Guyana Revenue Authority (GRA) has begun moving against businesses targeting unsuspecting consumers, by applying the 14 per cent Value Added Tax (VAT) on items which are zero-rated or exempt.
GRA targets businesses wrongly charging VAT
–as Finance Minister urges ‘Buyer Beware’ of shady vendors
by Gary Eleazar
This was confirmed by Tax Chief, Godfrey Statia, who on Thursday (March 2, 2017), met with members of the press at the Ministry of Finance on and said the Agency is in reports of the practice and has since begun taking action.
He was joined by Finance Minister Winston Jordan. According the GRA Commissioner General, , the tax collection outfit has begun writing to companies where the prices of products have gone up under the false pretext of applying VAT.
He said GRA has since been directing that the incorrect prices will have to be changed. “We have written several of the companies where we have noticed that instead of the price being reduced, it gone up,” according to Statia.
He spoke too, of a public awareness attempt by GRA through notices in the local newspapers that speak to the directive. Finance Minister Jordan told media operative the practice of overcharging by misapplying the 14 per cent VAT on exempt or zero rated items poses a challenge for all of the stakeholders involved inclusive of the local commerce and private sector representatives.
“This is a bigger wider issue not only for GRA and the Ministry of Finance,” Jordan said and singled out the “Private Sector Commission (PSC) who tells you their members are all good folks who doing the right thing, all the other Chambers of Commerce, clearly the Consumer Organizations, clearly a matter for the Ministry of Business,…a multitude of stakeholders.”
He warned, “buyer beware” and called on consumers to be more aware of what they are paying for items paid for in order to not be ripped off by businesses engaging in such practices. The Finance Minster said there will always be business people looking to take advantage of the system and posited, “even if we had zero tax on any good, people would tell you why they had to increase their rates.”
Jordan said there are unsuspecting customers who would simply “buy, put it in the tray and we leave…we have to, in this environment here where every dollar saved, is a dollar gained we have to be far more consciences.”
The Finance Minister contends that each has a role to play in guarding against such unscrupulous practice, “in making certain that these ropaqueous (opaque/shady) businesses either are shunned or are sidetracked.”
The duo were at the time appearing for the first press engagement for 2017, in order to address many of the concerns surrounding the recent reduction of the 14 per cent VAT and its accompanying widening of the base—concerns that led to widespread public outcry and protest action.
Defending the administration’s rationale behind the change in the VAT regime, Minister Jordan maintains that the tax should not be seen in isolation but rather in the context that was outlined during his Budget Presentation.
Government, he said, must be cautious of its projected revenues and expenditure in order to calculate how much it can borrow in order to even fund its 2017 Budget.—$38B of which still has to be borrowed.