Fear and insecurity in depositing monies in bank accounts will flourish with the empowerment of the Guyana Revenue Authority (GRA) to garnish funds held by taxpayers who have outstanding tax arrears, says President of the Private Sector Commission (PSC) Eddie Boyer.
Private Sector Commission Chairman Eddie Boyer
Finance Minister Winston Jordan announced on Monday that provisions of section 102 of the Income Tax Act Chapter 81:01 will be revised to provide authority to the GRA to access any taxpayers’ bank account in order to ‘garnish’ monies it claims to be owed.
Boyer, in an invited comment to by Guyana Times, said this power bestowed upon the country’s tax authority is a major cause for concern when the repercussions of such a move are examined.
He opined that the Private Sector does not support persons bypassing on paying their taxes; however, he indicated the procedures enforcing tax collection must include mechanisms that do not drive apprehension among the population.
“I don’t think the power to GRA to garnish your bank account without a court order should be done by… If they have a court order, fine, that would give check and balance,” he noted.
The PSC Chairman explained that the consequences of such a move will be dire as persons, out of fear, will move to withdraw their monies from the banking system.
“The ramifications of it or what I think would happen as it relates to persons in the banking system, persons in the Diaspora; these people will find ways to take their monies out of the banking system for fear that their monies will be garnished without proper regulations…It gives the feeling of insecurity, if there is no court order,” Boyer explained.
According to the PSC Head, such an outcome would be counterproductive to the Government’s efforts and vision to promote a society that is not heavily dependent on cash-based transactions.
Last month, Government had announced that it will take a major step along technological and digital lines, encouraging through legislation the use of cards to transact financial businesses.
Telecommunications Minister Cathy Hughes had said she hopes to take to Parliament next year a draft legislation to support such a paradigm shift, noting that discussions are already ongoing with the Bank of Guyana Governor Gobind Ganga in this regard.
Opposition Leader Bharrat Jagdeo had also expressed utter shock over Government’s inclusion of such a measure in the budget, noting that it was “unbelievable”.
On the other hand, the Finance Minister, in his budget presentation, explained that such a measure “would assist to improve compliance with demands issued by the GRA for outstanding payments.”
The National Budget 2017 also empowers the GRA further by preventing persons from leaving the country until outstanding arrears are settled. GRA will no longer be required to secure a court order in order to enforce this provision, according to Minister Jordan.
Jordan announced too that the GRA will be looking to put in place an “Excise Stamp Programme”, based on an Agreement with Canadian Bank Note (CBN).
An excise stamp is a type of revenue stamp affixed to excisable goods to indicate that the required excise (and other) taxes have been paid on the product.
“This will see the stamping of alcohol and tobacco products with high-security stamps, which can be read by barcode scanners,” according to Jordan.
He used the opportunity to announce too that the Commissioner General of GRA will no longer be allowed to provide extensions for the payment of VAT.
Explaining his rationale, Jordan told the House, “VAT is funds held in trust, no such right should be given to taxpayers regarding payment… therefore this provision will be repealed.”
