GRA denies delay in handling MovieTowne transaction

The Guyana Revenue Authority (GRA) yesterday denied being responsible for the delays claimed by MovieTowne owner, Derek Chin and laid out the timeline of agreements with the company to substantiate its claim of timely facilitation.

Through its Head Godfrey Statia, the GRA released a statement to the media on the matter. The GRA head said that the agency was setting the record straight and said that it even allowed for the continued construction of the Turkeyen facility, although it was in breach of the terms of another Investment Development Agreement (IDA).

“Based on the said IDA, equipment earmarked for use on another major project was being utilised in the construction of MovieTowne,” Statia said in the release.

It appeared to be a reference to the contractor, CHEC’s work on the Cheddi Jagan International Airport, Timehri.

During a tour of the facility last week, Chin had highlighted an experience with the GRA and bemoaned that at one point he had to leave goods at one of the local ports for more than six weeks. He said the wait resulted in high demurrage costs since he had to wait more than a month for a signature from the Ministry of Finance for the release of his goods.

But Statia said that Chin went ahead and brought items for the project without first getting the approval.

Noting that the tax agency was legally guided by the rules of confidentiality, the GRA Commissioner-General gave a timeline of events from its first meeting with the principals of MovieTowne leading up to December of last year.

“The facts are as follows: Construction of MovieTowne commenced in 2011. In mid-2017, the principal of MovieTowne first met with the GRA to discuss the issue of concessions, and at that meeting, requested that concessions be backdated to the commencement of construction. The GRA advised that concessions cannot be backdated and should have been applied  prior to the commencement of construction. The GRA also advised the principal that equipment currently being utilised in the construction of MovieTowne, was in breach of the terms of another Investment Development Agreement (IDA), since, based on the said IDA, equipment earmarked for use on another major project was being utilised in the construction of MovieTowne,” the statement said.

“Rather than terminating the IDA, and notwithstanding the breach, the GRA agreed to allow both projects to continue, with the understanding that the available remedies under the said IDA will be enforced subsequent to the completion of both projects. MovieTowne submitted an IDA application to Go-Invest, which was copied to the GRA and was advised in September 2017 by the GRA that only concessions similar to those granted to competitors in the industry will be allowed, and further that additional information was needed inclusive of source of financing before a recommendation can be made to the Honourable Minister of Finance for approval. MovieTowne’s container arrived at the wharf on October 21, 2017, and without the approval of the IDA, the GRA facilitated MovieTowne to clear its goods with a Prior to Processing (PTP) arrangement on November 19, 2017.The goods were uplifted on November 28, 2017 demonstrating that there were no delays on GRA’s part,” it added.

Statia said that on December 29, 2017, MovieTowne was granted an IDA “consistent with those granted to competitors in the industry which allow for the waiver of Duty and VAT on certain equipment”.

The Commissioner General had told this newspaper, in a recent interview, that the agency is continuing to assess dozens of IDAs signed before his tenure began in 2016 and has found that many individuals and companies have robbed the state of hundreds of millions in taxes.

Seen by many observers as a ‘no nonsense’ tax agency head, Statia has maintained that collection of taxes and providing assistance to taxpayers was his main objective and will be handled in a nonpartisan and unbiased manner. “I have no friends when it comes to collection of taxes and no one dare call me to ask me favours. That is not how a tax agency is run,” he said.

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