…taxes deferred for affected businesses that retain staff
The Guyana Revenue Authority (GRA) has taken a number of measures in a bid to help combat the spread of the coronavirus. These include the waiving of taxes on certain critical supplies that have been subject to heavily criticised price gouging by some businesses.
According to the Authority on Wednesday, the value added taxes (VAT) and associated duties that are usually paid on medical supplies used in testing for, preventing, and treating the coronavirus will be waived.
GRA noted that this include, but is not limited to, “soaps; disinfectant sprays; hand sanitizers; sanitizing wipes; face masks; rubbing alcohol; and multivitamins and vitamin C tablets until June 30, 2020.”
It was pointed out by the tax authority that waivers have already been granted on 15,000 litres of rubbing alcohol provided to the Public Health Ministry by Demerara Distillers Limited (DDL).
Deferred tax payments
Meanwhile, GRA also announced measures for businesses that will be hit by the economic after-effects of the coronavirus. According to GRA, these businesses will be able to defer the advance payment of corporate and individual taxes until June 30, 2020.
There are conditions for such businesses to be eligible, however, as these measures apply to businesses such as those involved in the airline and tourism industries, as well as associated businesses, like hotels and transportation services.
In addition, GRA noted that such businesses must continue to employ their staff, or send them on extended vacation leave.
According to GRA, these businesses can pay their advance taxes on a current-year basis, without any penalties or interest.
The International Monetary Fund (IMF) had recently released an assessment in which it ranked Guyana among the few countries in the region least prepared to deal with the effects of the coronavirus epidemic, particularly the negative effectives it will have on the economy and tourism.
In that assessment, the IMF rated countries in the Americas from red (least prepared), to green (most prepared). Countries like the United States and Canada were in the green zone. However, Guyana, Guatemala, Belize and Honduras were not so lucky.
Neighboring Brazil was considered more prepared than average, while countries like Colombia were rated as less prepared. According to the IMF, the virus is likely to have immediate economic impacts on the region, including financial restrictions, declining commodity prices, and reduced tourism.
Some measures have been taken by authorities in Guyana to slow the spread of the virus. These include closing schools and the Bank of Guyana interceding with local banks to make conditions favourable to allow customers to stay home and practise social distancing without a financial blowback.
President David Granger had also written a ‘blank cheque’ for the Health, Education and Citizenship ministries in order to meet expenditure related to addressing the demands of the coronavirus disease.
A less popular measure taken by Granger was the Public Health Ordinance, which gave the Public Health Minister and other officials draconian powers to confront the pandemic, including the right to destroy property of those infected by the virus.
The Ordinance signed by Granger has no direct measures listed to combat the deadly disease, since the coalition Government just “copied and pasted” it from a 1945 health ordinance without having it revised. This view was expressed by People’s Progressive Party/Civic (PPP/C) former Member of Parliament Dr Vindhya Persaud during an interview with Guyana Times wherein she explained that no changes were made to the ordinance, which according to her becomes evident when both the 1945 and present-day edicts are examined; and she said that no direct measure for COVID-19 is found listed, but rather those for other infectious diseases.
In addition, the Finance Ministry had disbursed to the Public Health Ministry $120 million from the Consolidated Fund, which, according to reports in sections of the media, is to purchase medical equipment to outfit quarantine sites, and also to procure masks and oxygen tanks.
An application to the World Bank for a loan of US$5 million has also been made. Around the same time Guyana made its application, however, Venezuela was turned down after making a similar application. Guyana’s application is still pending.