The Guyana Revenue Authority (GRA) plans to increase the number of VAT registrants by some eight per cent during the year, utilizing the Total Revenue Integrated Processing System (TRIPS), a modern computerized system, which it implemented from January 1 last year.
In a GRA press release, Commissioner of the Value Added Tax (VAT) and Excise Tax Department Hema Khan said that while there are currently 2,300 VAT registrants, there are a number of persons who should be registered but are not.
With the introduction of TRIPS in 2007, the authority now has transactions covering a 12-month period that were conducted at the Customs and Trade Administration. GRA can use this information to track delinquents.
“Additionally, VAT registrants who make sales to businesses have to report such sales to claim input tax credits,” Khan is quoted as saying.
Also expected to be added to the list are voluntary registrants – persons who do not necessarily meet the $10 million threshold but still register because they see the benefits of being registered. The release noted further that registered companies tend to do business with other VAT-registered businesses as they are able to benefit from the input tax credit scheme VAT offers.
Khan said three criteria must be met before an application for voluntary registration is approved: the business location must be fixed and identifiable, the applicant must be able to keep proper records and must demonstrate an intention to make taxable supplies.
A person’s business has not yet started or has been in operation for less than one year, the applicant must produce evidence of bank loans and revenue projections, purchases of capital equipment or similar information to show intention to make taxable supplies.
Meanwhile, Assistant Commissioner VAT operations Bridget Abraham said the department will be utilizing its data sources to ensure that those persons who are required to be on the VAT list are registered. She said that the commissioner has the power to register those businesses that should have been registered mandatorily but failed to do so. And businesses that fail to register are subject to penalties by law.
A person who fails to register is liable for a penalty that is equal to double the amount of output tax payable from the time the person is required to apply for registration until an application is filed.
Moreover, “knowingly or recklessly” failing to apply for VAT registration could draw on conviction a $25,000 fine and imprisonment.
