Guyana has exempted the operators of the Stabroek Block from a series of taxes, and it will cost the people dearly, according to a Canadian Engineer, Darshanand Khusial.
The Lead Operator on that block is ExxonMobil subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), with 45 percent interest. Its partners are Hess Guyana Exploration Limited (30 percent interest) and CNOOC Petroleum Guyana Limited (25 percent interest).
A homeless man sleeps outside Parliament Building.
In a letter to the editor, the professional wrote that as taxes are fundamental to developing the social, physical and economic infrastructure of a country, the waiver granted by Government to these companies is unfair, especially when compared to what commercial enterprises in Guyana are made to pay.
According to the Guyana Revenue Authority (GRA)’s website, the current tax rate for commercial enterprises is 40 percent.
“One cannot help but notice the irony of small Guyanese businesses struggling to pay 40% taxes but wealthy multinational companies having to pay no taxes,” he wrote.
“Guyana is helping the rich foreign shareholders get richer while its poor sleep on planks with cardboard sheets.”
The Engineer wrote that ExxonMobil has paid US$110B in taxes to the United States Government in the decade to 2015, and that it has probable paid more than US$500B in taxes in its history.
In Guyana’s case, he wrote “We know that Exxon has stated Guyana will receive revenues of US$7 billion for Liza Phase 1 which contains 450 million barrels of oil. The oil companies’ profit will be slightly less than that, let’s assume US$6.5 billion.”
Scaling up that figure from 450 million barrels to six billion barrels, he calculated that ExxonMobil would earn at least US$87B from extracting the current discovered reserves.
If they were required to pay taxes at the commercial rate, Khusial pointed out that those reserves would secure Guyana almost US$35B for the Guyanese people.
“That is more than enough to provide world class services to our 775,000 citizens.” Khusial stated.
He asked, “Why is it fair for Exxon to pay U.S. government hundreds of billions of U.S. dollars in taxes on oil profits but none to Guyana? Shouldn’t our citizens have reliable electricity like the Americans? Don’t our citizens deserve world class healthcare like the Canadians?
“What about social safety nets like affordable housing for our poor? Not to mention, reinforcing the sea wall to reduce floods? Or do the foreign oil companies view us as a ‘shithole country’ to be exploited for the benefit of rich foreign shareholders?”
