The Guyana Association of Bankers Inc had denied allegations made by the Guyana Revenue Authority that the local banking sector is failing to honor its tax obligation.
In a statement, both commercial and non-bank financial institutions said that they have honored there debts over the years.
This came after GRA claimed that the local banking industry owed some $4B in corporate tax.
The issue first stemmed from Citizens Bank receiving Notices of Assessment from the GRA back in December 2018, claiming additional corporation taxes amounting to some $534,416,000.
According to GABI financial statements are prepared, reviewed and finalised in keeping with domestic, regional and international accounting and taxation standards as well as Bank of Guyana regulatory guidelines.
At a press conference on Friday, however, Statia explained that “banks are commercial entities in the business of lending and have bad debts; however, while the financial standards allow banks to make provision for these debts in their accounting, the Corporation Tax Act speaks about bad debt in a different light. We deal with actual bad debt – not because you provide for a bad debt means it will actually be bad… You cannot write off that debt as a provision and expect GRA to accept it.”
However, the Bankers Association said that the approach currently employed by the commercial banks have always been accepted by the relevant authorities and this has been well-documented and confirmed by the tax collection body.
The Association had already approached GRA, through the Bank of Guyana (BoG), to come to an agreement on the matter but the tax boss is adamant that he will not change the assessment. In light of this, GABI said it has engaged experienced, legal and accounting minds to pursue this matter to the fullest extent on its behalf.