Georgetown: The Private Sector Commission (PSC) says the A Partnership for National Unity (APNU+AFC) government move to implement a ban on importation of vehicles that are eight years and older as a decision which is ‘unnecessary’ at this time and will have a negative connotation on many.
In this regard, the Commission is urging the government to “seriously” review and reconsider taking such move since it will place undue pressure on low and middle income earners.
Opposition Leader Bharrat Jagdeo called on the coalition government to change the restriction of the importation of used and/or re-conditioned vehicles to under twelve (12) years old – instead of eight (8) years – from the date of manufacture to the date of importation. He said this will ensure that persons from the lower middle class and the poor, many of whom purchase vehicles on terms, as well as auto dealers, do not suffer the gravity that the announced move will have on their lives and livelihoods.
He said he spoke to an auto dealer who explained that a Toyota Premio costs $2.5M on the local market, and if the new model is to be imported it will cost buyers $3.6M, which is over $1M more than the cost currently.
Jagdeo also called on the coalition Government to “remove totally or change the restriction” of the importation of used and/or re-conditioned heavy duty motorized vehicles, including trucks, canters, etc., to between fifteen (15) and twenty (20) years old – instead of eight (8) years – from the date of manufacture to the date of importation. He said many in the construction, mining, rice, forestry and transportation sectors will benefit from such a change.
Currently, a single axel truck costs between $5M and $6M and the new policy will see that cost increased to as much as $18M. The same applies to double axel vehicles with the cost moving from between $9M and $10M to $27M.
He also called on the David Granger-led Government to withdraw the ban on the importation of used tyres.
Jagdeo had suggested expanding the staff and strengthen the regulatory capacity of the Guyana National Bureau of Standards (GNBS) to ensure the quality of the used tyres. According to him, justifying the move as an effort to boost road safety is not completely factual, since most of the accidents on our roadways are caused by drunk driving and speeding.
“I spoke to one owner of a canter and the cost for a tyre is $16,000. The proposed ban will now see him paying $70,000. Imagine the prices for bigger tyres. The prices will be astronomical. A new tyre will now cost about 50 per cent of the minimum wage, which is $50,000,” Jagdeo added.
Meanwhile, the PSC’s statement also highlighted the planned early implementation of the requirement to provide compliance certificates in order to obtain licences as “a major concern.”
According to the Commission “we feel that this measure, while being a good way to ensure compliance, should have been implemented at least a year after the date of its announcement to give persons time to get their taxes in order. The capacity of the Guyana Revenue Authority is paramount to the smooth implementation of this measure and we do not believe that the agency is currently capable of handling the expected thousands of persons who will be seeking in a short time to regularise their status as taxpayers.”
It also registered its disappointment that its recommendation to the government of having a comprehensive reform of corporate taxes and Pay As You Earn (PAYE) was not taken into consideration at this point in time.
The private sector body says it does not understand that such reform may have to await the findings of the Tax Reform Committee.
Meanwhile, the PSC pointed out that the tax threshold increase as announced by the administration during the presentation of Budget 2016 last week is a welcomed move, adding that it could have been increased higher.
The body said it is also pleased that there was no reduction in the rate of the Value Added Tax (VAT). “We are also happy that packaging materials have been made exempt from VAT and that tax refunds can now be applied across the board. The increases in gun licence fees are also fair and will boost government revenue but we are concerned about the impact on indigenous people who rely on shotguns for their livelihood,” the PSC said.
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