Digicel snarls back at Jamaica tax authority

(Jamaica Observer) Digicel snarled back at the Tax Administration of Jamaica (TAJ) yesterday, accusing the government body — which launched an armed raid on the cellphone operator’s offices last week — of “utter and complete incompetence”.

The tax collector’s claim that they were owed J$111 billion in GCT over three months implies that every man, woman and child in the country was spending an additional, undeclared J$13,762 a month with Digicel, it said.

And that would have given it sales ten times higher than its external auditor, PricewaterhouseCoopers, had accepted when it signed off on the company’s accounts.

“It is now abundantly clear that TAJ completely misunderstood the data it had been provided, and — rather than seeking clarity — it arrived at its own grossly inaccurate conclusions,” Digicel said.

Those conclusions led to the raid on the company’s New Kingston offices on Friday afternoon, supported by police with high-powered weapons, who prevented staff from going home at the ends of their shifts.

The company has since provided counselling to some of the distressed staff who were held in custody.

Digicel was granted a Supreme Court injunction against the search while it was under way and the ban was upheld in court yesterday.

The hearing was adjourned until May 24 to give lawyers for the TAJ time to prepare their case.

TAJ spokeswoman said she could not speak about the matter as it was under investigation.

Digicel said it was “shocked and offended” by the search, which it described as a “witch hunt”.

The Jamaica Manufacturers’ Association also condemned the tax raid, saying: ” The treatment meted out to Digicel is reprehensible and speaks volumes about the way we treat businesses in Jamaica.”

The raid does not portray Jamaica as an investor-friendly place to do business, it said.

Digicel complained that the raid had done “reputational damage”, both in Jamaica and internationally.

“Every dollar of GCT collected (by Digicel) is paid over in full, and on time, to the tax authorities,” it said.

The company said TAJ’s actions were based on “flawed logic and methodology”.

“TAJ was consistently using the wrong source documents in its analysis and, as such, the resultant outputs were fundamentally flawed,” it said.

“Where was the management oversight?

“Certain documents which TAJ maintains were not provided by Digicel were provided in February and March, and this fact was acknowledged by TAJ’s representatives after they entered Digicel’s premises last Friday and were shown what was previously sent to them.”

It was only on Saturday that the company found out what the tax collectors were looking for.

“It is very unfortunate that TAJ did not choose to meet with Digicel to discuss its findings prior to adopting the heavy-handed and inappropriate action it chose to take last Friday, as such a meeting would have clearly demonstrated that TAJ’s conclusions were inaccurate, unrealistic, flawed and misguided.”

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