− tax evasion remains a “sad reality” in Guyana – GRA Chairman

When communities fail to produce the revenues that reflect their observed level of economic activity, the Guyana Revenue Authority (GRA) said it will have to use its enforcement authority.

Chairman of the Board of Governors of GRA Rawle Lucas

This is according to Chairman of the Board of Governors of GRA, Rawle Lucas, who said Guyanese taxpayers need to come up to par by honouring their obligations in this regard.
Lucas speaking during a media conference Friday at the entity’s Camp Street, Georgetown, Headoffice, said GRA is seeking to up its game in providing a comfortable environment for taxpayers and workers; but the situation needs to get better.
According to him, the board examined economic data over the period 2006 to 2014 to establish some preliminary estimates of the tax base. The methodology used relied on that used by the Bank of Guyana (BoG) to realise the resource gap and get a true sense of the resource shortfall.
“The question that arose from the numbers that emerged was how we can spend so much from so little money. We looked in the usual places like borrowing, remittances from abroad and foreign investments and aid. He said the reconciling items could not reconcile our spending,” he said.
According to Lucas, the methodology confirmed that the tax base was ill defined and distorted and in need of urgent refining.
“Consequently, another of our goals this year, is to give accurate measurement of our tax base for future tax planning; further an inaccurate tax base can lead to revenue loss, as revenue leaks through the various tax structures”.
The ones that are of greater concern, the chairman said, are the losses from selfemployed income tax, property tax, value added taxes and import duties.
He said one of the troubling things seen so far, is the relationship between the total number of registered tax payers and those who are actually paying tax.
“In an economy that was growing at an annual average of 4.5 per cent, the number of persons paying taxes was declining. We intend to study this phenomenon some more to understand the behaviour of these variables and to reverse the unconfirmed trend.
“It is under circumstances like these where revenue collection does not match observed level of economic activity that the GRA must use its enforcement authority, when tax collection reaches the stage of enforcement, demands of GRA become more onerous for the taxpayer.”
Luicas said the issue has led the board to call for disaggregated data about tax collection:
“We intend to disaggregate the data, by sector, by industry, by regions and by important economic hubs or centres.”
According to him, the work done so far excludes Georgetown, which is by far the most important economic centre. The data, according to him,  covers Anna Regina, Bartica, Corriverton, Lethem, Linden, New Amsterdam, Ogle and Parika and what has been observed are  of both interest and concern, he said.
“Those eight centres are contributing only two per cent of Revenues. This is as much a surprise. One would have thought the in an area such as Corriverton, with its multisectoral economy and border trade, it would have been making a larger contribution to tax revenues than the $1.3 billion and substantially more than an area like Linden that bring in $1.1 billion on a much narrow tax base”.
He said it is surprise too that areas such as Anna Regina and Bartica combined, cannot do as well as the relatively economic depressed area like New Amsterdam.
Lucas said the GRA will have to make the decision to use its tax enforcement officers to seek compliance in this regard. According to him, the entity has the legal right to carry out such functions.