Indigenous People’s Affairs Ministry helps GRA define hinterland residents to be exempt from VAT on airfares

Last Updated on Tuesday, 31 January 2017, 18:21 by Denis Chabrol

In the wake of concerns by the National Air Transportation Association (NATA) about how domestic airlines would identify hinterland residents so that they could be exempt from the 14 percent Value Added Tax (VAT) on airfares, the Guyana Revenue Authority (GRA) said the Ministry of Indigenous People’s Affairs has assisted with a definition.

The Value Added Tax Act 82:05 Schedule 2 was recently modified to exempt Transportation supplies as follows: A supply of services of transporting passengers or goods by air from one place in Guyana to another place in Guyana subject to the signing of an agreement between the Government of Guyana and the provider of the service for persons living in rural areas.

The GRA said the Ministry of Indigenous Peoples’ Affairs proposed the following definition for persons living in rural areas after the tax agency sought its advice.

“Persons who are hinterland residents:

PROVIDED that such persons are:

1. Indigenous Peoples ordinarily resident in Guyana’s hinterlands, OR
2. Indigenous Peoples temporarily resident elsewhere in Guyana for purposes related to education, work or receipt of resident health care, OR
3. Citizens who are ordinarily resident in Guyana’s hinterlands having been born there or having their immediate families ordinarily resident there.

The Guyana Revenue Authority (GRA) says it will be making contact with the relevant service providers to discuss the signing of the agreement and to provide further clarification regarding the implementation of this amendment.