“Garnishing” of Bank Accounts
Executive Member of the People’s Progressive Party (PPP) Anil Nandlall has responded to accusations made by Finance Minister Winston Jordan in another section of the media, that the PPP party, while in office had itself introduced the freezing of bank accounts.
PPP Executive Anil Nandlall
The article, according might be a response to the “avalanche of criticisms heaped upon the measure announced by the Minister of Finance in his budget speech to take monies from persons’ bank accounts in satisfaction of outstanding taxes”.
The issue surrounds the Minister’s announcement during the reading of the 2017 National Budget last Monday that permission will be granted to the Guyana Revenue Authority to “garnish” outstanding funds from the bank account of tax defaulters.
But Nandlall on Sunday said the issue was never about “freezing of bank accounts, but the invasion of persons’ bank accounts without an Order of Court and to take monies from and apply it to taxes owed.
“In the article the Minister is quoted as saying that the provision of garnishment is one which already exists in the Value Added Tax Act promulgated by the PPP and the GRA already has this power under the VAT Act; that the government is simply provided a similar measure under the Income Tax Act”.
Nandlall said he can find no such provision in the VAT Act which authorizes the GRA to go into tax-payers’ bank accounts and seize proceeds in satisfaction of outstanding taxes.
“Of course the Minster did not refer to any section of the VAT Act. I do not think he could have. There appears to be none”, the former Attorney General said.
He continued, “On the contrary, garnishment is provided for in the Income Tax Act. However, it is limited to authorizing GRA to go after the debtors of a defaulting tax payer and recover the debts from those debtors and apply the same to liquidate the tax arrears of the tax-payer. In their current formulation the relevant sections of the Income Tax Act do not authorize the GRA to go to the defaulting tax-payers’ bank accounts and take proceeds therefrom in satisfaction of outstanding taxes. It would appear that this is a new measure being introduced by this Minister into the legislative tax architecture of Guyana”.
Another issue of concern, Nandlall continued is that the VAT Act allows the GRA to prevent a person who owes VAT from leaving the country, but only by an Order of Court. He said the Minister has indicated an intention to amend the VAT Act to remove the requirement of a Court Order.
“Why would the Minister want to do such a thing? This, again, smacks of authoritarianism and unconstitutionality”.
“This is the very Minister who says at page 22 of his budget speech: “Mr. Speaker the Constitution of the Co-operate Republic of Guyana is the bedrock of governance and serves to secure the fundamental rights and establish the rule of law for all Guyanese”… “It is either the Minister of Finance is engaging in amateur propaganda or he is hopelessly confused”, Nandlall said.
