July 6, 2016. Citizensreportgy.com
LOCAL manufacturing companies now have to pay taxes or duties on raw materials – taxes that were previously waived under the former People’s Progressive Party/ Civic (PPP/C) Administration.
And Opposition Leader, Dr Bharrat Jagdeo, in an invited comment, declared that the A Partnership for National Unity and Alliance For Change (APNU+AFC) Coalition Government “has gone completely insane” by virtue of its actions.
“The government has gone completely insane. I was told they have practically shutdown the tax-free importation of inputs (raw materials) for our local manufacturers. This is a desperate measure to bolster dwindling tax revenue,” he said.
According to him, rather than address the “core reasons” for the revenue shortfall, which is the precipitous drop in economic activities in the country and “the ineptitude in defining a way forward,” the government has resorted to targeting the productive sectors of our economy with taxation.
“This ill-advised policy in relation to the manufacturing sector will have dire consequences for those companies and may result in the closure of some of them and the loss of thousands of jobs,” Jagdeo said.
As such, the Opposition Leader has since called on the APNU+AFC Government to reverse its decision. “I call on the government to immediately reverse this anti-manufacturing policy,” he said.
At least one company, Denmor Garment Company, has been closed for two weeks because the textiles it imports were left sitting on the wharf. Several other manufacturing companies are reportedly on the brink of shutting down operations because of the new tax on imports of raw materials.
Additionally, there was no notice of the imposition on the tax on raw materials imported for manufacturing purposes.
The waiver on duties/taxes on raw materials imported to Guyana for manufacturing purposes was done as a means of stimulating local production. There have been no explanations as to why the waiver was removed, in addition to the fact that there was no notice of its removal. There was also no consultation on the move.
The Guyana Revenue Authority (GRA) has been tasked with enforcing the new taxation policy.
GRA and Government officials were unavailable for comment when contacted by this news agency.
