GOVERNMENT OF GRENADA

Ministry of Finance, Planning, Economy, Foreign Trade, Energy & cooperatives

 TAX AMNESTY

 “A Once in a Lifetime Opportunity for offenders to become Tax Compliant”

Take Advantage of the Opportunity – November 17, 2008 – March 31, 2009

Guidelines for Grenada Tax Amnesty

Overview

The Government of Grenada is committed to a tax system that is simple, equitable and easy to administer.  Government is also committed to improving the business climate thereby allowing businesses to thrive.  Finally, Government is working to improve the efficiency of its tax collection effort.

Based on the foregoing, Government has observed that many taxpayers have significant arrears with Inland Revenue. These arrears are not only impacting negatively on government’s revenue collection but also business performance and expansion.  Some taxpayers in arrears are almost paralyzed by the magnitude of their arrears. Still others appear to have given up.  Furthermore, some businesses are unable to access concessions for expansion because of tax arrears. 

Against this backdrop and consistent with its priority of stronger economic management, Government has decided to implement a tax amnesty.

1.      What is this tax amnesty? For a very limited period, Government is offering taxpayers with arrears, the opportunity to pay off their taxes without interest and penalties.  In many cases, the interest and penalties are more than the actual taxes because of the delay in the payment of these taxes.  Where a taxpayer agrees to promptly settle all outstanding taxes, Government will grant a 100% waiver on interest and penalties between November 17, 2008 and March 31, 2009.

2.      Which taxes are eligible?  All taxes.  However, the major tax types are Corporate Income Tax, General Consumption Tax, Personal Income Tax and Property Tax.  The amnesty will cover all arrears up to December 31, 2007.

3.      Who is eligible?  All taxpayers.  The amnesty will also extend to persons who are registered taxpayers but have not filed their returns and paid their taxes.  Such persons can file and pay, without interest and penalty, in the period of amnesty.  Also, the amnesty allows persons/businesses, who have not yet registered, to register, file and pay during the amnesty, without interest and penalty.

As Grenada prepares for the implementation of the Value Added Tax (VAT), registration is essential.  Persons/businesses that are not VAT-registered will not be entitled to VAT refunds.  This means the cost of their business will be higher than it should be. Additionally, persons/businesses who fail to eliminate all arrears during the amnesty period would find that upon the implementation of VAT, all eligible refunds/credits would be applied to their outstanding arrears until it is cleared.

4.      How can a person take advantage of this limited offer?  Persons can call the Inland Revenue at 435-1905, 435-6945/46, or 440-3556 to clarify tax balances or make an appointment to discuss their accounts.  Special arrangements are being made to facilitate taxpayers who wish to take advantage of this opportunity.  These include field collection by bailiffs and a dedicated staff in Inland Revenue to expedite the payment process. 

For the taxpayer who is ready to pay, he or she can simply go into the Inland Revenue Department and pay by cash or cheque.  Persons who have previously written “bounce” cheques to Inland Revenue will be required to pay by certified cheque or bank draft. 

What if a taxpayer cannot immediately settle all outstanding taxes?  The taxpayer may elect to settle one or more outstanding taxes or enter into a payment plan with Inland Revenue.  It should be noted that persons who are currently on payment plans may alter their plans to benefit from the amnesty.

5.      Why is this tax amnesty a good idea for taxpayers?  First, it is considerable cheaper to pay off taxes without interest and penalties.  Second, it is even cheaper to borrow money to pay of the outstanding taxes (typical bank rates are between 9% and 11%) compared with interest charges by Inland Revenue which are between 18% and 24% per annum.   Third, it cleans up the books of the taxpayer in readiness for the Value Added Tax.

6.      What happens if taxpayers do not seize this opportunity?  Inland Revenue will aggressively enforce tax laws such as seizure of property and other assets to satisfy outstanding taxes.  Furthermore, Government may consider the imposition of a tax compliance certificate in order to access certain basic services.  The requirement for this certificate may also extend to persons who have not paid licences such as business, driver or motor vehicle.

7.      Consultation before Implementation: Government has raised the idea of a tax amnesty with selected stakeholders during the recent budget consultations.  There is broad support. 

However, concerns have been expressed about Government’s commitment and capacity to enforce after the period of amnesty. 

As indicated, several steps will be taken including the requirement for a tax compliance certificate to access certain services.  Anyone with comments or suggestions on these guidelines, may call 435-1905, 435-6945/46, 440-3556 or 435-0057 or send an e-mail to This e-mail address is being protected from spam bots, you need JavaScript enabled to view it or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it .

8.       Implementation Period: The tax amnesty will commence on November 17, 2008 and end on March 31, 2009.