Let’s cooperate on VAT - Finance Minister urges
Guyana Chronicle
December 12, 2006
FINANCE Minister, Dr. Ashni Singh, yesterday urged members of the private sector and the business community to work with the Guyana Revenue Authority (GRA) in a “spirit of cooperation” to ensure the successful implementation and administration of the Value-Added Tax, set to come on stream January 1, 2007.
His call came at the opening of a four-day workshop on VAT accounting at the Regency Suites Hotel on Hadfield Street, Georgetown.
Speaking to a large gathering of participants from the business community and the private sector, the minister said close collaboration between these entities and the GRA is critical for the successful implementation of VAT, the Government Information Agency (GINA) reported.
“The private sector must play its part and ensure that its members are educated and knowledgeable of the characteristics of VAT, and what it means for their businesses and the country. I don’t think anyone will argue with the fact that this is a positive step for Guyana. We are now catching up with many countries in the world,” he said.
GINA said the mechanics of VAT will ensure that no added burden is placed on the consumer, since several basic food items and other essential supplies have been zero-rated or exempt.
Zero-rated supplies are goods and services taxed at zero per cent. Standard-rated supplies are goods and services taxed at a rate of 16 per cent of their total value.
All goods and services provided for domestic consumption will attract VAT at the standard rate, unless explicitly excluded in the law as zero rated or exempt supplies. Exempt supplies are those that are not taxed, the agency explained.
Businesses must register for VAT if their annual turnover of taxable supplies exceeds $10M per annum. Once registered, any VAT they incur in the course of making standard-rated or zero-rated supplies can be reclaimed, or offset against the tax they have collected from their customers and which they must pay to the GRA at regular monthly intervals.
This system also acts as an incentive for businesses to register, since unregistered entities will not be eligible to receive any refunds, and will be liable to face penalties under the law.
In this regard, GINA said, Commissioner General of the GRA, Mr. Kurshid Sattaur, urged businesses to comply with their legal obligation to register.
“Once you are honest and honourable in the administration of the VAT, the GRA will have no reason to force compliance. It is therefore imperative that you adhere to the rules and regulations that govern the tax, and ensure that you register and comply with the procedures for its administration”, he said.
The GRA, Sattaur said, will continue to work closely with the private sector, and endeavor to address their concerns to ensure that VAT is effectively administered after its implementation.