... Phillips backs decision to reveal beneficiaries
CHURCHES, SCHOOLS, non-governmental organisations, and some of the biggest corporate players are reportedly among the private entities that received write-offs.
Some of the arrears built up were linked to problems with the revenue collector’s old International Computer Tax Accounting System, which created reconciliation problems when a new system was implemented, the tax commissioner, Ainsley Powell, explained.
“Prior to 2010, payments made by taxpayers were sometimes inaccurately allocated to the wrong period(s) resulting in erroneous liabilities. Balances transferred from the old paper ledgers sometimes did not reflect the correct balances for periods as the ledgers had missing returns amounts such as credits or refunded amounts,” he said.
TAJ also needed to clear its books of arrears that could not be collected for reasons including that persons being out of business, businesses closed, deceased taxpayers or persons migrated.
“The broad-brush write-off was intended to remedy all those issues and create a new slate going forward,” the commissioner argued.
Clarke also explained that a large stock of tax arrears resulted in an overestimation of revenue forecasts and overcommitment in expenditure leading to debt accumulation.
Asked why the broad-brush write-offs were not itemised, Dr Peter Phillips, who was finance minister from 2012 to 2016, said he could not recall making a decision on what was published.
“I remember that the general principle was that debt that was not collectible and had not been collected going up to 10 years in some instances, seven years in others, that we decided that the TAJ should have the authority to determine that a debt was uncollectible, to write off and that it would be gazetted,” he told The Sunday Gleaner.
“The whole thing would have been recommendations coming from TAJ. The power rested with TAJ. The minister only had the power to say yes or no … . I don’t recall ever taking a decision on the publication.”
Phillips said he supports the decision of the Holness administration to publish the details of each taxpayer that benefited from broad-brush write-offs.
“I think the fullest amount of transparency in the matter would benefit the public.”
In a previous response to
The Sunday Gleaner, Clarke admitted that the tax-write off system needed to be “more transparent” and the administration would “immediately” start making changes.
“I will direct that where an order is published in The Gazette on the tax write-off determinations made by the commissioner general. We will upload that issue of The Gazette to the ministry’s website within 30 days of it being printed,” he said.
The Gazette does not state precisely why each company gets a write-off, merely noting that the tax boss has determined the sums to be cleared as “uncollectible”.
On that, Clarke said the finance ministry would examine “whether the write-offs can be categorised by the specific criteria in the regulations on which the commissioner general made the write-off determination”.