Dr Clarke should review the current GCT payment protocol

THE EDITOR, Madam:

In 2011, then Minister of Finance Audley Shaw, in an effort to finalise a new agreement with the IMF, introduced a plethora of new taxes, fees and other fiscal changes.

A major plank in the tax collection system was a change in the general consumption tax (GCT) regime, which saw new regulations mandating the collection of GCT from importers at the Port of Entry and famously not at points of sale (POS) of the goods which was the original law and precedent.

In 2012, when the PNP administration came to power, then Deputy Prime Minister and Minister of Finance Dr Peter Phillips doubled down on these new regulations and added a few of his own, namely, Customs User fees, Customs Administration fees, Environmental Taxes, and the list goes on.

Over these last 12 years, the requirements for importers to pay the GCT at the port with Custom duties has been like an albatross around the necks of large, middle and small businesses, robbing us of critically needed cash flow.

The Government will argue that you can claim back the GCT you paid as a credit against future GCT liabilities. But this is cold comfort because at this stage it’s just an exchange of paper which you cannot take to the bank.

The Government will never return cash even when your credit exceeds your liabilities. And they do not allow you to use your credits against other liabilities like statutory deduction or corporate taxes.

The entire procedure used to implement these kinds of economic polices without any consultation or input from the business community smacks of an abuse of power and authority by the GOJ and its agencies.

I think the economic turnaround that we have seen in the latest data on the economy is based in part on the hardship and sacrifices that we in the businesses sector have made.

The Minister of Finance Dr Nigel Clarke should revisit and review the current GCT payment protocol, including the way the Customs Department calculates the GCT and Customs duties together. It weaponises the method used to ensure that (in some cases) it collects up to 100 per cent of the average payment on the CIF value of the import invoice.

The GOJ must understand that excessive tariffs and other business costs are ultimately passed on to the consumer, increasing the cost of living and hardship for most people. This cannot be a good thing for any government in power.

WINSTON BARRETT