$16 million judgment leaves IRD empowered , money will provide much needed relief – Pompey
Unicomer St Vincent Limited (Courts SVG) says the Company is working to “better understand” a judgment of the High Court of St Vincent and the Grenadines (SVG) in which it has been ordered to pay approximately EC$16 million in taxes and interest demanded by the Inland Revenue Department (IRD), while the IRD, on the other hand, says the judgment debt will provide “much needed relief” to the country.
SEARCHLIGHT reached out to Courts SVG yesterday and in response to a question about if the debt will be paid, the Company said the matter is still under legal review.
“Noting this, Unicomer (St. Vincent) Limited continues to work with our legal team to better understand this decision. We will take all appropriate actions to ensure our business operates as usual in St Vincent, while remaining aligned with our corporate values and commitment to the local community and authorities,” the company stated.
On the topic of if they had been engaging in tax evasion, Unicomer St Vincent said, “…Unicomer (St. Vincent) Limited is and has been committed to following all laws and policies of St Vincent and the Grenadines, as well as all other countries in which we operate. We believe we have fully complied with all tax regulations, which is why we have sought relief through the legal system.”
Going forward, the Company which has been part of SVG’s business landscape for three decades remains “committed to the economic development of the community and maintaining exceptional business practices in the retail sector.”
It is “…vested in being a part of the St Vincent business landscape and the well-being of Vincentians. In light of this, we will continue to work through the respective tax matters with the relevant authorities to ensure the sustainability of our business and to help maintain its benefit to the community.”
The IRD on the other hand, following the April 29 judgment by Justice Nicola Byer, said in a release that it is anticipating “that the approximately $16 million judgment debt would contribute to providing much needed relief.”
“This judgment comes at a time when SVG is experiencing significant economic and financial challenges due to the effects of the volcanic eruptions and the ongoing Covid-19 pandemic,” the release from Comptroller of Inland Revenue Kelvin Pompey said.
“We are confident that Unicomer (SVG) Ltd., being part of a major multinational corporation and given its vast financial resources, would take the requisite measures to ensure that the judgment debt is made payable to the IRD in a timely manner,” the release said.
This would prevent them from seeking to enforce the judgment through other available means, they say.
The release, dated May 19 further stated, “The Unicomer judgment signifies a major victory since this is the first time that the IRD has had a High Court ruling on such highly technical issues of accounting and law.”
“Secondly, the victory represents a maturation of the IRD’s capacity to successfully challenge businesses with accounting practices that are not in compliance with the Income Tax Act.”
The IRD also noted, “We have been exposing our auditors to local and external training in accounting and tax law practice and this case demonstrates that we are now in a position to proactively and robustly address issues of non-compliance, especially stemming from the operations of multinational corporations.”
He explained that the SVG IRD needs, as their international and regional counterparts, to have the capacity to examine the “…the complex inter-company issues relating to multinational corporations” because their significant cross jurisdictional transactions “..present unique risks to tax departments through transfer pricing and profit shifting arrangements.”
This legal victory has left them empowered, but “we are cognizant of the need for continued focus on transparency in the IRD’s operations as well as respect for the rights of taxpayers.”
They believe the judgment shows that taxpayers at all levels can access the objections and tax appeal systems and the High Court in defending themselves against assessments made by tax personnel.
“…. The IRD is therefore pleased that these systems are working as they should and provide checks and balances on our operations and procedures.”
But they remain committed to settling disputes outside of these arenas.
“…Notwithstanding this, we welcome the opportunity to establish jurisprudence through the court system, which would act as precedents in interpreting tax legislation and guiding our in-house operations and procedures,” the Comptroller also stated.
The IRD thanked their internal auditing team that worked on this matter from the audit stage up to the High Court level, in-house objections unit, Counsel Kezi Francis and external Counsel Duane Daniel and Jenell Gibson “for their invaluable contributions to this victory”.