Local gov’t minister facing scrutiny over order to waive taxes on city building

Local Government Minister Norman Whittaker last month ordered a waiver on rates and taxes amounting to $22 million on a city property, prompting accusations that he broke the law.

By way of a letter, dated July 16th, 2014, Whittaker instructed acting Town Clerk Carol Sooba that he was ordering that the rates due on the property that currently houses the Universal Church of the Kingdom of God, at Charlotte and Wellington streets, be waived by the City Council for the years 2002 to 2009. A copy of the letter seen by Stabroek News includes a handwritten note by Sooba, dated July 18, 2014, advising the City Treasurer of the “ministerial order” and to make the required adjustment.

However, both the authority by which the minister purportedly granted the order and the grounds for giving the waiver are under scrutiny. Several officials at City Hall have accused Whittaker of acting outside of his authority in issuing the order.

Norman Whittaker
Norman Whittaker

Whittaker, in his letter, states that the order was made by virtue of the authority vested in him by the Municipal and District Council Act of 2013. “The Honorable Minister has no objections to granting the requested waiver in respect of all rates and taxes accruing during the period January 2002 to December 2009, and consequently, by virtue of the authority vested in the Minister of Local Government and Regional Development under the Municipal and District Council Act 2013; it is the order of the Minister that the rates due on the property described above for the period stated be waived by the council,” the letter said.

In an interview, Whittaker had told Stabroek News that “the Minister can waive rates and taxes under certain circumstances,” as a result of which no rates shall be payable. “I would grant them it (the waiver) if the council cannot give it to them,” he said.

He cited the Section 212 (a) Municipal and District Councils Act as the law that permitted him to grant waivers on rates and taxes.

However, a source close to City Hall who spoke with Stabroek News recently said the minister has no authority to waive rates and taxes. “The minister has no such powers…,” the source said, while adding that although the legislation was amended last year it says nothing about the powers of the minster to waive rates.

 Section 212 states:

“(1) A council shall have power to exempt from liability to pay rates either wholly or in part, in respect of the properties listed in this section, the owners of-

(a) any property used for the advancement of religion, education or social welfare, not with a view to profit;

(b) any property used mainly for the purpose of open air games or of open air athletic sports and occupied by a club, society or other organisation which is established or conducted with a view to profit;

(c) property used exclusively for the purposes of a hospital, dispensary or public health institution

Where the council is satisfied that liability to pay the whole of the rates would seriously prejudice the successful attainment of the objectives or purposes for which the organization, club or society exists.

(2) The Minister may by order designate any other property in respect of which no rates shall be payable.”

Section 212(2) suggests that the minister’s power might be restricted to designating properties exempt from paying rates and taxes but not granted waivers, which is the remit of the council.

“It must be done by a proper order,” the source also argued.

Meanwhile, according to Whittaker’s letter to Sooba, the petition for the waiver on rates and taxes was made by the proprietor and former Managing Director of Ganga Prasad and Sons Ltd, on the ground that from January 2002 to December 2009 he made the building available for use to the church to advance its religious work at no cost. He adds that the applicant asserted that all taxes/rates due to the council prior to 2002 had been paid in full by Ganga Prasad and Sons Ltd.

The property, however, housed the Strand Cinema until 2008, when it was officially converted into the church building. The source close to City Hall however argued that the building is owned by Prasad and not the Universal Church, which is paying rent.

Meanwhile, the source also told Stabroek News that the matter was before the courts before and the council had received judgment on the matter. “It was appealed by Mr. Ganga Prasad. The appeal has not been heard and so therefore the Minister cannot supersede the order of the council. He has no authority,” the source noted.

Whittaker, however, said that he was not aware of this. “I am not aware of those things (matter before court)… I did not usurp the council. I said the minister has no objection. I did not waive the taxes. I did not instruct them (council) to do anything,” he said. The source also spoke of a similar case where the previous minister Ganga Persaud had written to Sooba to waive rates and taxes for the playground at Lamaha Gardens, the sale of which is now at the centre of a legal dispute. “The minister wrote to Sooba before about the Lamaha Gardens playground… he asked her then to waive the rates and taxes and since then he did not have any authority to do so,” the source said.

In that case, the Ministry of Local Government, by way of a letter dated January 3, 2013, wrote the Town Clerk approving a waiver of $3,219,046 due in rates for the property. However, in defending the government’s actions in that case, Attorney General Anil Nandlall earlier this year said that the Ministry of Local Government has no lawful power to waive Rates and Taxes. “All or any matter in relation to the collection of Rates and Taxes falls within the remit and authority of the Georgetown Mayor and City Council,” he wrote in a letter published in Stabroek News.

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