Dear Editor,
In reference to a letter from the Guyana Revenue Authority (GRA), published in the local press on October 14, 2017 under the caption “The Corporation Tax Rate for non-commercial companies was reduced in 2017”, I wish to quote from my letter on October 11, 2017, which stated:
“With respect to corporation taxes (CTAX), according to the Ram & McRae website, there are three rates of CTAX in Guyana: a 30% rate that applies to non-commercial companies, a 40% rate that applies to commercial companies except telephone companies, and finally a 45% rate for the telephone companies.”
The last time I checked, as a subject of study, comprehension was still being taught in the schools of Guyana, and I am hoping that the GRA thinkers did benefit from that subject. I sourced my information from the tax experts in Guyana, and they said 30% and I accepted it; and yes, I am responsible.
To their credit, Ram & McRae did contact me to advise that their website was not updated, and acknowledged the inaccuracy. They subsequently updated their website, and thus the inaccuracy is acknowledged. So a good thing was done because of my letter — the Ram & McRae website is fully updated as we speak. If one reads the Ram & McRae website today, it offers enough information for me to make the following statement, which I have cross-referenced with the GRA website: “there are three rates of CTAX in Guyana: a 27.5% rate that applies to non-commercial activities, a 40% rate that applies to commercial activities except telephone companies, and finally a 45% rate for the telephone companies.”
But it is unfortunate that the GRA took the liberty to point out that there were “several inaccuracies” in my letter, but then only mentioned one, as discussed above. The last time I checked the Oxford dictionary, “several” meant: “more than two”. At a minimum, I expect from the GRA some level of honesty and integrity.
I want to make it very clear if the 27.5% rate is used for non-commercial activities, it does not negate the call for a reduction in the Corporation Tax. The progressive countries in the neighbourhood have an effective CTAX rate band that starts at 25% and thus Guyana’s band, which starts at 27.5%, is still uncompetitive regionally.
It is my understanding that when you refute a position, you offer an alternative position, but GRA offers none. Well, in democracies that I have lived (Guyana after 1992, UK and the USA), when you refute a position, you explain yourself and bring closure to your statement; not operate like you are in Zimbabwe or North Korea and refute a statement and then automatically expect all to bow and accept your position.
I am saying that 27.5% is greater than 25%, and thus the conditions still remain for tax avoidance, transfer pricing, and to discourage investment. What is your reason for refuting this argument GRA?
Regards,
Sase Singh
