Country Name: Guyana
Currency: Guyanese Dollar (GYD)
Primary Tax Authority: Guyana Revenue Authority (GRA)
Key Legislation:
- Income Tax Act
- Corporation Tax Act
- Value Added Tax Act
Fiscal Authority Allocation
Centralized Fiscal System:
Guyana operates a centralized tax system. The Guyana Revenue Authority (GRA) is responsible for administering and collecting taxes, including corporate income tax (CIT), personal income tax (PIT), and value-added tax (VAT). Local governments collect property taxes and certain municipal fees, but most tax revenue is collected by the GRA.
Corporate Income Tax (CIT)
Standard Rates:
Guyana applies a dual CIT rate structure based on the type of business:
- Non-commercial companies: 25%
- Commercial companies (including trading companies): 40%
For companies in the petroleum sector, specific tax rates and agreements may apply depending on the nature of the operations.
Corporate Forms and Taxation:
- Limited Liability Company (LLC): Subject to the standard CIT rate of 25% or 40%, depending on the company’s classification as commercial or non-commercial.
- Corporation (Public Limited Company – PLC): Typically used by larger companies, taxed at the same rates as LLCs.
- Branches of Foreign Companies: Taxed at the same CIT rates as resident companies on Guyana-sourced income.
Exemptions and Incentives:
- Tax Holidays: Guyana offers tax holidays of up to 10 years for businesses operating in specific industries such as agriculture, tourism, and manufacturing.
- Investment Incentives: Companies that invest in key sectors, such as renewable energy, agro-processing, or infrastructure development, may qualify for accelerated depreciation, investment allowances, and other incentives.
Goods and Services Tax (GST) / Value-Added Tax (VAT)
Standard Rate: 14%
Guyana applies a VAT rate of 14% on most goods and services. VAT is levied on the sale of goods, the provision of services, and imports.
Exemptions:
Basic food items, certain educational services, medical services, and some public transportation services are VAT-exempt. Exports are zero-rated, allowing businesses to reclaim VAT on input costs related to export activities.
Personal Income Tax (PIT)
Progressive Rates:
Guyana applies progressive personal income tax rates to both residents and non-residents:
- Up to GYD 780,000: 28%
- Above GYD 780,000: 40%
Personal income tax is levied on worldwide income for residents and on Guyana-sourced income for non-residents.
Dividends:
Dividends are subject to a 10% withholding tax when paid to resident and non-resident shareholders.
Additional Mandatory Contributions
Social Security Contributions:
Both employers and employees must contribute to Guyana’s social security system, which provides pensions, healthcare, and unemployment benefits.
- Employer Contribution: 8.4% of gross salary.
- Employee Contribution: 5.6% of gross salary.
Withholding Taxes
- Dividends: 10%
- Interest: 20%
- Royalties: 20%
Withholding tax rates may be reduced under Guyana’s double taxation agreements (DTAs).
Transfer Pricing Rules
Guyana does not have formal transfer pricing regulations, but companies are expected to adhere to the arm’s-length principle for cross-border related-party transactions. Companies should ensure that transactions between related parties are conducted at fair market value.
Special Tax Regimes
- Petroleum and Mining Sectors: Guyana has specific tax regimes for companies operating in the petroleum and mining sectors. These include special corporate tax rates, royalties, and production-sharing agreements that govern the taxation of these industries.
- Tourism and Agriculture: Companies in the tourism and agriculture sectors benefit from tax holidays, reduced import duties on equipment, and VAT exemptions on certain inputs.
Other Taxes
- Real Estate Tax: Property taxes are levied by local municipalities and are generally based on the assessed value of the property.
- Capital Gains Tax: Capital gains are taxed at a rate of 20% if the asset is sold within 12 months of acquisition. Gains from assets held for more than 12 months are taxed at 25% for individuals and 40% for companies.
- Excise Duties: Excise duties apply to specific goods such as alcohol, tobacco, and fuel.
Double Taxation Agreements (DTAs)
Guyana has signed several double taxation agreements with countries including Canada, the United Kingdom, and CARICOM countries. These treaties help reduce withholding taxes on dividends, interest, and royalties and prevent double taxation of cross-border income.
Local Taxes
Local governments in Guyana collect property taxes and certain municipal fees. However, the GRA is responsible for administering and collecting income tax, VAT, and other major taxes.
Compliance and Reporting
Annual Filing:
Corporate tax returns must be filed by April 30th of the following tax year. Personal income tax returns are due by the same date. The tax year in Guyana follows the calendar year.
Penalties for Late Filing:
Penalties for non-compliance or late filing include interest on overdue taxes and fines. Interest on unpaid taxes is typically charged at 2% per month, with additional penalties depending on the severity of the delay.
Recent Developments
Petroleum Sector Growth:
Guyana’s growing oil and gas sector has attracted significant foreign investment. The government has introduced specific tax measures to regulate this industry, including production-sharing agreements and royalty payments.
Green Energy Initiatives:
Guyana is promoting investment in renewable energy projects as part of its commitment to sustainable development. Tax incentives are available for businesses investing in solar, wind, and hydroelectric energy projects.
Digital Services Tax:
Guyana is considering implementing a digital services tax aimed at taxing foreign digital platforms that provide services to Guyanese consumers, such as streaming services and online marketplaces.
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