Guyana Stores still to make payment on $3.8B in tax arrears

Guyana Stores

A month after its last deadline passed, Guyana Stores Limited (GSL) has seemingly still made no payment on the over $3.8 billion in taxes owed to the Guyana Revenue Authority (GRA).

Chairman of the GRA Rawle Lucas told Stabroek News on Thursday that the May meeting of the Board of Governors received no report of payments made by GSL.

Lucas explained that he has since made no request for information on the matter but expects a report at the next meeting, which is to be held this month.

On March 5th, the Caribbean Court of Justice (CCJ) issued a ruling that GSL was liable for more than $3.8 billion in payments to the Revenue Authority.

GSL had received a demand, dated May, 2012, from the then GRA Commissioner General Khurshid Sattaur for the sum of $3,811,346,397 in unpaid taxes and chose to institute proceedings in the local courts. The company filed a constitutional challenge to the 2% minimum corporation tax applied by the GRA under the Fiscal Enactments (Amendment) Act. Having lost at both the High Court and Appellate Court, GSL appealed the matter at the level of the CCJ, which has now dismissed GSL’s appeal and ordered the company to pay costs to the three respondents: the Attorney General, the Revenue Authority and the Commissioner General.

In its judgement, the final court told GSL that it should have utilised the specialised procedure provided under the Income Tax Act to challenge the GRA, rather than bring claims for constitutional relief in matters where not only was an alternative remedy available but that remedy was the natural and statutorily provided recourse. To do otherwise, it argued, was “an abuse of process.”

Since then, Commissioner General Godfrey Statia has indicated that GRA was unwilling to consider being lenient in this case.

Asked if the company would be able to access the amnesty on interest owed, which is currently being offered to defaulting tax payers, Statia had said that GSL would not.

Statia further explained that while in 2012 the company owed GRA $3.8 billion dollars, it has not filed tax returns since that time and is therefore liable for a greater sum than up to the point that the  CCJ ruled. The authority, he explained, is prepared to accept a minimum payment of $300 million in the first instance.

“It is more when you add outstanding tax returns that he has not been filing… they were so sure of their case that they have not filed tax returns. There are at least eight years of corporate tax returns outstanding,” he said, while adding that since the court’s ruling the GRA has met with the main shareholder to give him a chance to submit these outstanding returns and to provide a settlement proposal.

GSL had been given an initial deadline of 30 days after the March 5th, 2018 ruling by the CCJ but the shareholder was at his request granted an extension until April 30th, 2018, the due date for countrywide submission of 2017 tax returns.

However, that deadline has passed and repeated efforts by Stabroek News for an update on the situation have proved futile. This newspaper has been unable to reach the Commissioner General and GSL has indicated that it will not be speaking publicly on the matter.

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