GRA cancels VAT on airfares for interior locations

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The Government of Guyana has inked an agreement with Air Services Limited which will reverse its 2017 decision to impose taxes on flights to interior locations.

The Guyana Revenue Authority (GRA) in a public notice said it, “wishes to advise air service operators that no VAT shall be charged on airfares to transport passengers or goods to/from airstrips listed below”.

A few of the 54 listed locations are located in Regions One (Barima-Waini), Seven (Cuyuni-Mazaruni), Eight (Potaro-Siparuni) and Nine (Upper Takutu-Upper Essequibo). They include Achiwib, Aishalton, Annai, Baramita, Chenpau, Dadanawa, Iwokrama, Kamarang, Kato, Monkey Mountain, Orinduik, Paramakatoi and Waramadong.

Although the notice did not inform when the new decision takes effect, it pointed out that, “Pursuant to the Agreement, VAT is also exempt from airfares to transport passengers or goods to any other rural airstrip, provided that satisfactory evidence is submitted to the company that the passenger is living in the rural area”.

Effective from February 1, 2017, the Government had implemented a 14 per cent Value Added Tax (VAT) on local airfares, a move which was heavily criticised.