-vehicles to be detained
The Guyana Revenue Authority (GRA) yesterday said that it has uncovered a racket, which is estimated to have cost “hundreds of millions in lost taxes” where unscrupulous importers including some auto dealers, have made false declarations as to the engine capacity (cc) of some luxury motor vehicles contrary to the provisions of the laws.
The revenue authority said it uncovered the racket as part of its due diligence aimed at collecting the rightful revenue due to the State.
The GRA says it has commenced a widespread tax compliance activity to detain all such motor vehicles, where the engine capacity, among other declarations, were falsely made. The GRA says it is advising that any person found to have made, submitted or caused another person to make or submit such incorrect declaration(s) may be prosecuted, in accordance with the applicable laws administered and the motor vehicle(s) may detained or be seized, unless the full and applicable taxes, together with any applicable penalty are immediately paid thereon.
The GRA, in its release, says it is again reminding the taxpaying public that the agency “remains its partner in development of our country” and encourages all persons involved in or benefitting from this activity to voluntarily visit its headquarters at 200-201, Camp Street, Georgetown and/or make contact on telephone no. 225-5061 ext. 2501-2508, to immediately commence the process to have such motor vehicle deemed entered, by payment of the full and applicable taxes and penalties to avoid prosecution. The GRA is advising that “cooperative persons who comply with voluntary declarations will not be prosecuted neither will their motor vehicle/s be seized or detained.”
Just recently, the GRA had warned of another scam where it said Guyanese overseas were being recruited to pose as remigrants to acquire duty-free concessions on vehicles after which the vehicles are sold to others.
In a statement, the GRA said that it had begun questioning the source of funds for remigrants as there appeared to be unscrupulous behaviour where people from overseas were being recruited simply to benefit from the reduction and then just leave the jurisdiction.
It said that in keeping with policy, remigrants are allowed a vehicle for their own use, subject to various conditions stipulated in the law. This concession depending on its “cc of the vehicle” allows re-migrants to pay significantly reduced taxes on vehicle imports, i.e., 10%, 20%, or 30% excise tax, depending on its engine capacity. It said that a normal taxpayer importing or buying an unlimited engine size, high-end vehicles usually pays in excess of $44 million in taxes, versus a maximum of $6 million that a purported remigrant would incur for the same vehicle.
“This has allowed for unscrupulous person(s), including some auto dealers, seeking to utilize this system, by enticing potential remigrants for monetary gain, to travel to Guyana, apply for the remigrant status and a high-end vehicle, then leave the jurisdiction. More alarming is that many of the applicants have little or no financial means, nor a bank account, are not even registered, nor filed tax returns in their country of origin, or sometimes do not even possess a driver’s licence in the foreign jurisdiction. When their documents are submitted and analyzed, they often show little or no funds for years, but prior to or after the receipt of the approval, large and sudden cash injections into their just opened bank account, local or foreign, and from unknown persons and benefactors, who are nowhere to be found or refuse collaboration, of the deposit (as was in the case ruled on by the Chief Justice), all with the intention of facilitating the purchase of high-end vehicles. The vehicles are then utilized or purchased by ineligible persons, through the process of powers of Attorney, or possession, resulting in tens of millions revenue losses to the State”, the GRA stated.
The statement said that this practice is becoming so prevalent that the GRA has even seen employees of certain treaty-exempt organisations and even public servants being involved in the said activity, hence the resort by the Authority to the “he who asserts must prove” principle, by requesting the source(s) of funds used in the acquisition of the said high-end vehicle.
The Revenue Authority said it is aware of, and takes seriously, its roles and responsibilities, as mandated by the various laws of Guyana that it administers. The Authority is also a Supervisory Authority tasked with regulating and ensuring compliance with the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Act, Cap 10:11, another reason/rationale for the “source of funds’ request.
The Authority also has certain tax and information treaties with several jurisdictions and is further obliged as a Supervisory Authority under the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Act, to share such information with its counterparts. The Authority fully intends to do so by the filing of “Suspicious Activity Reports” of these transactions, the statement said.
