Excise tax rates applied by GRA to remigrants’ duty-free vehicles unlawful – CJ

– GRA advised to refund taxpayers who overpaid duties

Acting Chief Justice Roxane George granted an order declaring that the Guyana Revenue Authority’s imposition of excise tax at the rate of 30 per cent was illegal and ordered the entity to refund taxpayers who overpaid duties on imported vehicles.
Since July 2023, the Guyana Revenue Authority (GRA) raised the taxes payable by re-migrants from 10% excise taxes to 30% excise taxes on vehicles with engines larger than 3,000cc.
Back in April 2024, the Commissioner General of the GRA, Godfrey Statia, had written Aditya Basdeo that he was given duty-free concessions as a re-migrant. However, Statia required that Basdeo pay 30% excise taxes on his new generation 2023 Toyota Landcruiser vehicle.
This resulted in Basdeo ordering his attorney-at-law to write the GRA on April 15, 2024, complaining over the decision since the correct and proper excise tax rate was 10%. In Basdeo’s case the 10% was equivalent to over $1.5 Million.
However, the GRA insisted that he pay nearly $4.6 Million– a difference of $3.1 Million in illegal taxes. As a result of a lack of responses from GRA, Basdeo caused his attorney, Siand Dhurjon, to sue the GRA on May 28, 2024.
“Last week, the GRA’s Deputy Commissioner, Gavin Low, responded by saying that regulations of July 10, 2023 tripled the rate of excise taxes payable from 10% to 30%. For the last year the GRA was tripling the excise taxes payable by re-migrants for vehicles with an engine size of 3,000cc and above and doubling the excise taxes (at the rate of 20%) for vehicles with an engine size above 1,999cc and under 3,000cc,” a statement from the lawyer said.
“However, when the matter came up for hearing before the Chief Justice, counsel for the GRA, Ms. Nicklin Belgrave, reported that the GRA made a mistake because they realized that the Minister of Finance had merely signed the regulations of July 2023 but the regulations were not duly brought into force by being published in the Official Gazette or being tabled in the National Assembly.”
This means that based on the court’s determination, GRA had been wrongfully and illegally charging 30% taxes to re-migrants and collecting those taxes. All orders sought by Basdeo were therefore granted by the Chief Justice, who declared that the 30% excise tax being collected was unlawful.
“The Judge also granted an order of mandamus to compel the GRA to apply the correct excise tax of 10%. The Judge granted an order that Basdeo’s 2023 Landcruiser must be released to him forthwith upon payment of the correct excise taxes. Basdeo’s Landcruiser had come into Guyana on June 28, 2024, and has been on the wharf racking up storage costs ever since.”
“The Chief Justice ordered that the GRA was to pay the storage costs as well as the costs of the lawsuit in a specified sum to Mr. Basdeo. When presented with evidence that the GRA was charging some people 10% and others 30% during the same period, the GRA claimed that those paying 10% had applied for their exemption ‘before the regulation was passed’.”
According to the statement from the lawyer, the Chief Justice also remarked that GRA ought to reach out to those who have overpaid excise tax and refund any wrongfully collected taxes to those taxpayers. According to Dhurjon in an invited comment, remigrants who paid over 10% in excise taxes should seek a refund.
“The Excise Act and its regulations do not permit the GRA to charge beyond 10% in excise taxes. For the last year, the GRA has been overcharging remigrant taxpayers illegal excise taxes to the tune of hundreds of millions of dollars cumulatively. It is unfortunate that in oil-producing Guyana, taxpayers have been wrongfully subjected to this. But this verdict opens the door for all remigrants who paid above 10% in excise taxes to seek a refund,” he said.
Under the re-migrant tax scheme, Guyanese who lived abroad for 5 years can be given duty-free concessions allowing them to import their personal effects and their vehicles by only paying the applicable excise taxes.
When a re-migrant imports a vehicle and they are given the concession by the GRA, they do not have to pay customs duties and value-added taxes on the vehicle being imported. This removes many millions of dollars from the purchase of the vehicle.
If the full taxes – all of the customs, VAT and excise taxes – were paid on a Landcruiser like the one concerned in the proceedings, a normal taxpayer would have to pay around $90,000,000 in total taxes depending on the value of the vehicle.