GRA collects $217B in taxes in 2018

January 12, 2020 0 Comments

first_imgIn its perusal of records from the 2018 fiscal year, the Audit Office of Guyana (AOG) has found that the Guyana Revenue Authority (GRA) increased its collection of taxes by billions, so much so that it was able to cover for decreased revenue in certain categories.The Guyana Revenue AuthorityAccording to Auditor General Deodat Sharma in his 2018 report which was seen by this publication, $217 billion in taxes was collected and deposited in the consolidated fund. This is an increase compared to 2017, when a total of $171 billion in taxes were collected by GRA.Some categories that saw more taxes being collected than was expected are customs and trade, value-added tax (VAT) and internal revenue. internal revenue collection accounted for the most, $88.7 billion, compared to the $80.4 billion that was expected.The report notes that while $19.3 billion was estimated for customs and trade tax collection, an actual $22.1 billion was collected. In the case of VAT, $48 billion was actually collected, exceeding the estimated $43 billion.Excise tax collection also accounted for a significant portion of the overall sum, as $39.6 billion was collected. On the other hand, the AG recorded shortfalls in fees and fines (by $99 million), rents and royalties (by $321 million), as well as dividends and transfers (by $2.6 billion)However, the AG also noted that the overall increase was able to cushion the effects of the shortfalls in the varying categories of tax collection. In total, GRA surpassed its budgeted tax collection target by $15.2 billion.Meanwhile, GRA, when given a chance to respond, attributed all the increases to the higher value of some of the commodities that were imported. They also reported that 208 more importers have started making VAT payments.“Custom and trade taxes categories grew by $2.8 billion, reflecting higher revenue collections of import duties of $2.3 billion and environmental levy of $200 million. However, dividends and transfers to consolidated fund declined by $2.7 billion mainly on account of lower transferred amount by Guyana Geology and Mines Commission.”“The main contributors were internal revenue, value-added taxes, customs and trade taxes and excise taxes that exceeded the budgeted amount by $8.3 billion, $5.0 billion, $2.8 billion and $1.3 billion respectively. The increase from the internal revenue category were withholding tax $4.5 billion and personal income tax $3.8 billion.”GRA also noted that the increased collections from withholding tax was due to more companies making payments on overseas remittances. They also said that personal income tax collection showed increased receipts due to arrears payments from self-employed persons.According to the authority, there were additional initiatives that led to 193 employers and 171 self-employed persons making payments in 2018.While increased tax collection amounts to money for the state coffers, the parliamentary Opposition has long argued that from an economic sense, tax collection without corresponding growth in the economy is a bad combination.Back in 2017, Opposition Leader Bharrat Jagdeo had pointed out that when the 200 new tax measures which he said were introduced in 2016 fully kick in, Guyanese will feel the squeeze.“You will see the cost of living going up, the business community will be unable to survive in the new tax environment,” he had prophesied, adding that with the pressure from GRA, these businesses will not feel driven to invest and create more jobs in the future.“So, you would see not only deterioration in terms of cost of living going up, but less jobs being produced in the future because no one wants to invest in this country. And right now, people are losing jobs rather than them creating jobs that they (Government) promised,” Jagdeo had further stated.Over the past few years, industries like the agriculture sector and mining have shown contractions. Notwithstanding the poor performance in the various productive sectors, Guyana experienced a 4.1 per cent growth in the economy in 2018.In addition, the International Monetary Fund (IMF) had projected a 4.4 per cent growth for last year, with an even steeper growth curve projected by them after oil production starts. It has been observed by financial analysts, however, that this does not necessarily mean life has improved for ordinary Guyanese.last_img read more