The Guyana Gold and Diamond Miners Association (GGDMA) is accusing government of ignoring the plight of small and medium scale miners and it says new tax regulations are creating “significant hardships and chaos” in the mining sector.
The association has also warned that when the next tax season comes, many miners who are ignoring new tax requirements will feel the brunt of their actions.
In an advertisement in Friday’s Stabroek News, GGDMA highlighted its concern that while miners are publicly recognised for their production capabilities and contribution to the economy, their genuine concerns remain unaddressed by the authorities.
The two main issues of concern are the provision of concessions and the new requirements for miners to be tax compliant.
The GGDMA explained that despite its efforts to educate miners on the new tax regime and their obligations to the Guyana Revenue Authority (GRA), a majority of them still do not grasp what they are now facing as regards record keeping, remittances of higher tributor’s tax, and filing of returns in 2018, among other things.
Many miners, it said, are operating in a “business as usual” fashion and will not realise their errors until they have to make up their books and file tax returns in 2018.
Specific mention was made of the “hardship and chaos” which has resulted for those operators who have begun remitting the new 20% tributor’s tax. According to the GGDMA, they have “lost a significant number of their experienced and skilled workers to operators who have chosen not to deduct the 20%.
Despite this, the association maintains that its overarching concern remains that all small and medium scale miners will find themselves in a tough spot come 2018, where “acceptable records” to justify operating expenses will not be available if requested by GRA. Consequently, it said, these miners will not be able to justifiably compute their further tax payments or lack thereof to be made to the GRA.
The GGDMA advised that all small and medium scale miners immediately seek advice from a reputable accounting firm so that they can put their affairs in order to be fully compliant with the new tax regulations.
Additionally, the GGDMA noted that in December, 2016, agreements were signed which were to allow tax complaint miners to access concessions on fuel and materials used in the sector, yet four months later none have benefited.
“This is mainly as a result of bureaucratic bottlenecks experienced at the level of the GGMC (Guyana Geology and Mines Commission) and other agencies,” the association said, before questioning whether government truly intends for miners to benefit from the agreement, which expires at the end of 2017.
“Was this agreement executed for media propaganda purposes…we wait to be proven wrong,” it stated before once again requesting to meet with President David Granger and senior government functionaries to have these and other matters satisfactorily resolved.
In February, the GGDMA and the Guyana Women Miners Organisation (GMWO) wrote to President Granger seeking an urgent meeting and warning that if there wasn’t a meeting there would be a slowdown in gold declarations and a mass protest. Neither of these two threats have materialised even though there has been no meeting.
The miners groups have clashed with the government over the new tax measures and the two sides remain far apart on issues such as the doubling of the tributor’s tax and the required paperwork for tax payment purposes.
New tax measures that were announced in the 2017 budget include an increase in the tributor’s tax from 10% to 20% and a 2% tax on gross income and a requirement that miners file income tax returns at the end of the year. Certain goods and services will now attract the Value Added Tax (VAT). Miners also have to keep up-to-date records of all their transactions for tax purposes and this has been one of the sore points for the prospectors.
Government had sought to meet with the miners to have the measures explained.
A post-budget meeting was convened in January with the GGDMA, GWMO, small miners and sector minister Raphael Trotman and junior minister Simona Broomes.
Minister of Finance Winston Jordan, in February, noted that “at the end of that meeting we thought we had an understanding and clarifications and on various other issues. I even suggested that we, the government together with those organisations, issue a joint press release indicating some of the agreements that were reached. The next morning in the newspapers the GGDMA claimed that the meeting was hijacked by small miners and nothing came out of it. This was patently false.”
The GGDMA and the GMWO had said after the meeting that it was hijacked by certain persons who were not there on behalf of either of the two organisations and who had apparently been invited by the government.
A meeting was then held at the GGDMA headquarters, where Commissioner General of GRA Godfrey Statia sought to address the concerns of miners. This instead resulted in a call for a meeting with President Granger and the threat of strike and reduced production.
Government has since been encouraging the formation of mining syndicates, which would represent the interest of small miners.
