Dear Editor,
Your article `Pritipaul Singh to be refunded $246.4m in VAT’ in yesterday’s SN is accurate – to a point. While it is not our intention to have an adversarial relationship or a public exchange involving the Guyana Revenue Authority, for the benefit of other businesses similarly affected I need to point out that as confirmed by the public records to which your article alludes, this was no settlement. After a number of hearings at which the Guyana Revenue Authority was either unwilling or unable to make a commitment on the payment of the refund, despite the imperative of the law, the Court ordered the GRA to make the refund no later than Thursday of this week.
Editor, while we prefer to run our business legitimately, take care of our employees and earn foreign currency for the country, the Court was the only remaining option after two years of refund claims, letters, objections and appeal to a non-constituted Board of Review. Yet, despite this refusal by the GRA over such a long period and with the Company challenged for cash flow, at the Court hearing, the Company as a show of good faith, waived its statutory right to interest under the VAT Act and withdrew its claim for costs.
Whether the GRA will reciprocate to such magnanimity will be seen this week, and in the future in how it deals with the Company. We hope that it is purely on administrative grounds that the GRA has failed to respond to Counsel’s request on our behalf for payment to be made within the time ordered by the Court.
Editor, I wish to make a broader point about Value-Added Tax. With a subsequent change to the VAT Act, Finance Minister Winston Jordan has made Guyana the only country in the world I know of where exports appear not to enjoy blanket zero-rating or Exempt with Credits status. The effect of the Jordan amendment is two-fold: exporters now bear VAT on inputs and more importantly, our country’s exports are less competitive.
Looking at how both the Government and the GRA boast about how much taxes they keep collecting, it seems clear that maybe for different reasons both the Government and the GRA fail to understand how taxation affects both the macro- and the micro-economy, i.e. businesses. For the Government, extra taxes mean more resources to mis-spend while for the GRA, they enhance its image with the politicians and in the case of exports, it has less work to do since it does not have to process refunds.
Meanwhile, our company has witnessed reduced profits as a result of the Government’s ill-advised tax changes and a lowering of investment and employment in our workforce which is drawn mainly from the mixed communities in which we operate.
Finally, editor, our company has to acknowledge the excellent work by Attorney Christopher Ram who persisted when others might have buckled under the continuing rejections by the GRA. His respect for the Court, and the GRA and its counsel even as they disagreed, impressed me a lot.
Yours faithfully,
Vishnu Panday
Deputy Manager and Company
Secretary
Pritipaul Singh Investments Inc
