In defence of the BRA positioning
A week ago, it was the Charlie Charlie Challenge; before that, Chris Sinckler; now it would seem everybody hates BRA.
But since when has a BRA been a bad thing, particularly one whose job it is to pull back a very loosely operating and deeply sagging system?
For those with short, or worse yet, convenient memories, just cast your minds back to the Auditor General’s Report for 2014, in which the Auditor General flagged the Government’s worsening problem of revenue collection as matter for urgent attention.
That report also detailed findings of two special audits: one, the Value Added Tax Division; and the other, the Inland Revenue Department, two of the Government entities which as of April 1, 2014, were brought under the umbrella of BRA.
As pointed out in the report on the audits, taxes are the largest source of Government’s income, and the Inland Revenue Department was responsible for collecting $2.1 billion in cash between financial years 2011-2012 and 2013-2014.
However, not all revenue due to the department has been collected and, according to the Auditor General’s Report 2014, accounts receivables exceeded $250 million for the period under review.
The situation was hardly any better with VAT, as Auditor General Leigh Trotman revealed that local taxpayers owed Government over $400 million in taxes, while raising strong concern over the fact that the figure for outstanding accounts receivable had been increasing at an average rate of 13 per cent or $48 million a year.
“At the close of the financial year 2013-2014, the outstanding receivables at the [VAT] Division were $475 million,” Trotman said in his very detailed report, which further revealed that of the total amount, 57 per cent of the debt was over five years old; 20 per cent between two and five years old; 11 per cent, between one and two years old; and 13 per cent, less than a year old.
This begs the question: will the Government ever really be able to collect this outstanding debt?
And why hasn’t anyone yet been hauled before the courts for tax evasion?
We acknowledge that in this current economic climate it is hard, particularly for small operators, to stay afloat, or at the very least remain current in terms of their statutory commitments.
In such cases we believe special accommodation should and must be made where possible; but not so in instances where it is blatantly obvious that businesses and individuals have absolutely no intention of paying taxes as is required by law.
What was most interesting, based on the findings of the VAT audit, was that businesses were among the primary defaulters to Government when it comes to paying the 17.5 per cent tax, accounting for 83 per cent of the accounts receivables.
This compares to 13 per cent, which was owed by individuals and the remaining four per cent by Government departments and statutory boards.
In view of all the IMF has recently had to say about “our unwisdom in playing taxation” by imposing a tax to get revenue and then undermining our capacity to get the revenue by giving a whole set of allowances, it is therefore hard to see how anyone can question the recent actions of BRA, least of all promoters who should have known that before they set about pitching their tent for Crop Over, or any other festival for that matter, they needed to make themselves right with the
In fact, it should be counted among the factors critical for them to throw open their doors in the first place.
This is not to say that Government, and in this case BRA, has always acted 100 per cent correctly. If so, Customs workers would have been armed early o’clock with the necessary information for their July 1 transitioning into BRA, and there would have been no need for a second push back to the date for the changeover.
However, it stands to reason that if bandleaders, tent managers and other Crop Over “entrepreneurs” are willing to go to the trouble of setting up shop for the festival, albeit for reasons of national development, then they must also behave professionally in terms of registering their businesses and paying the necessary tax.
The same must of necessity apply to lawyers, doctors even journalists who are willing to exploit the market and branch out on their own. In other words, what is good for the goose must be good for the gander.
But as it stands right now, there are those who want to the authorities to simply fly the gate and allow them to let loose without the restraint or constraint of any BRA. However, in time, we believe that the entire culture will have to change, and, just like Mr Sinckler and our goodly Revenue Commissioner Margaret Sivers, all will come to appreciate the true value of a BRA.