On Thursday, a statement from the Ministry of Finance reported on the outcome of a meeting between the government,the GRA, and the Georgetown Chamber of Commerce and Industry (GCCI).
Minister of Finance, Winston Jordan was accompanied by the Governor General of Central Bank, Dr. Gobind Ganga and Commissioner General of the Guyana Revenue Authority, Statia.
New Chamber President Deodat Indar raised a number of issues:
1. VAT on private tuition and forestry products.
2. The rate and availability of foreign exchange
3. The state of the economy
4. Local content legislation in the context of the emerging oil and gas sector
5. GRA’s ‘uneven’ import valuation system
Jordan told the group that Cabinet has agreed to review all taxes including VAT on private tuition for Budget 2018. According to the Ministry statement,VAT on private tuition was not as a result of non-compliance by the owners of private schools as was being presented in some quarters but rather in the context of broadening the tax base.
On the question of VAT on forestry products, the Chamber stated that VAT on local forestry products makes them less competitive than imported building materials, and that this is disadvantageous to the local industry. The statement said that the Minister urged GCCI to have its stakeholders provide evidence-based data on the effects of VAT on forestry products so as to enable a review of tax measures on the sector and he offered to examine other incentives to help make the sector more competitive. The statement said that Indar welcomed the suggestions and promised to discuss them with his membership.
GCCI also reported that complaints about the unavailability of foreign currency are continuing particularly from small and sole proprietary businesses.
Ganga, informed that the exchange rate had stabilised and contended that there was enough foreign exchange available for banks to service requests particularly from small businesses and individuals. He was told that a request for CAN $1600 was turned down by one bank and he advised that banks should not quote the rates for currency if they do not have that currency for sale.
At the request of the GCCI, the statement said that Jordan agreed to the formation of a small working group comprising representatives of GCCI, other private sector bodies, importers, exporters and Central Bank to discuss and offer recommendations on the challenges affecting the smooth functioning of the foreign exchange market including rates, availability and retention accounts.
Jordan told the GCCI that there are opportunities available through various government initiatives which will assist in boosting the economy. These include an expanded Public Sector Investment Programme, the distribution of concessions in the Forestry sector, new Housing initiatives, and the imminent production of manganese in the north west. He also said that more than a dozen investors have expressed interest in GuySuCo and that Cabinet is actively examining those proposals.
Indar enquired about local content legislation for the petroleum industry while notifying that the Chamber would like the opportunity to comment on any new legislation as it believes that Guyanese should benefit from the oil find.
Jordan said that local content legislation to ensure domestic economic participation and development is being drafted and urged that the Chambers pursue partnerships with other stakeholders in the meantime.
The Chamber also reported that it conducted outreaches to businesses on Regent and Robb streets during which many business owners complained that the GRA is revaluing their invoices and this has resulted in the payment of higher taxes for imports. Indar requested that information pertaining to the process be provided to business owners.
According to the statement, Statia told the gathering that while imports remain stable, the Valuation Department of his Agency has observed widespread under invoicing of imported building materials. As a result, he said, the GRA will shortly issue a guideline for importers in relation to its valuation system.
Other issues raised include a request for the Food and Drugs Department to be strengthened, and for a revisiting of the 2am curfew on bars.