Clamp comes down on luxury vehicles under remigrant scheme

 Budget 2019 has measures to target weaknesses in the remigrant scheme and abuse to importation of vehicles.

Finance Minister Winston Jordan has announced an overhaul of the much-criticized remigrant system for vehicles.

In his Budget Speech in the House, the Minister said that the current remigrant system is flawed and has led to abuse on a number of occasions.  Over the years, persons have come in posing as returning Guyanese and bringing in luxury vehicles, which are either sold or handed over to the true owner for a small fee.   
There were instances where the remigrants returned overseas shortly after the transaction.
Tens of millions of dollars were lost to the coffers of Guyana.

According to Jordan, in order to ensure compliance, minimize, if not eliminate, the abuse, while simplifying the process, he is proposing a system of credits up to a limit of $5M for vehicles imported by a remigrant.

“With this system, a remigrant can bring as many vehicles as he/she wishes. For example, suppose a remigrant brings in three vehicles, with an assessed value of $20 million. Then the remigrant will be credited with a tax free allowance up to a value of $5 million, and would be required to pay all applicable taxes on the balance of $15 million.”

This would represent a major change from the previous practice where GRA received little.

It is likely to be unpopular for a number of auto sales companies, which have been capitalizing on the weaknesses of the remigrant system.

According to the Minister, the removal of the six-month overseas ownership will allow the remigrant the option of purchasing the vehicle locally, within six months of his/her arrival.

“This would be advantageous to the remigrant who lived in a country where driving is on the right, as opposed to Guyana, where it is on the left.”

It was disclosed that returning students who have completed at least three years of continuous study be eligible for remigrant status.

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Comments

  • Trevor  On December 1, 2018 at 1:47 am

    They will just divert those dubious sources of income to building fancy and upscale hotels for foreigners.
    The Dutch might have to return to save the coastline from sinking.

  • Kman  On December 1, 2018 at 2:08 pm

    I do not know anything about the Guyanese remigrant system, but I would like to make three points:

    1. To eliminate any loophole, require the remigrant to own the automobile for a set number of years to receive the full benefit. If the vehicle is disposed of before then the seller would be required to repay any monetary benefit to the government coffers.

    2. If the minister have proof that auto sales companies are scamming the system, then they should be dealt with accordingly.

    3. Why would the government extend the remigrant status to Guyanese students returning to Guyana after their studies. They do not own cars in the foreign countries in which they are studying. This is creating a big loophole.

    If there is a problem, then it should be thoroughly analysed before rushing to faulty cures.

    • Trevor  On December 2, 2018 at 8:43 pm

      Guyana was corrupt for decades, but America is also to blame as they send foreign ambassadors who import very expensive SUVs and import such luxuries tax-free, while we here in Guyana have to pay 14% VAT, it was 16% for years and even taxed on raw staple food for a while until it was removed.

      Wealthy diplomats, foreign investors and businessmen who live in mansions and own seven story malls in G/T used to pay 0% TAX on their children’s private school tuition. Private schools such as School of the Nations which charge $100,000+ every term (double the average monthly salary).

      Rich fat cats anywhere get loopholes.

      Americans have to pay more Obamacare while Trump has cut taxes for the corporations which hide money in offshore bank accounts.

      It makes me question whether the oil money here will be used to benefit the affluent to construct more gazillion storey hotels and malls while employing none Guyanese?

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