The Government of Belize is set to receive a big fat cheque tomorrow, courtesy of the Belize Bank. This afternoon, Justice Samuel Awich dismissed an application made by Belize Bank and its parent company, BB Holdings, for an injunction against the Government’s efforts to collect large sums in business tax arrears. Because of Awich’s ruling, the Bank is now compelled to pay more than five point seven million dollars tomorrow, in compliance with a ruling made in January by Revenue Magistrate Edd Usher. The payment is the second half of a total of eleven point four million dollars which the bank has been assessed as owing from April 2006 to September 2008. The context of all this is of course the Settlement Deed – signed by the previous government, which BB Holdings insists entitles them to special treatment in regards to the payment of business tax. Since taking office last year, the Barrow Administration has rejected the Settlement Deed as unlawful. Today’s decision is the latest in a series of legal proceedings that have emanated from the bucking of heads and though she was elated this afternoon, the Attorney General’s representative Lois Young told us she expects the bank to pay... and to appeal. And what about the Arbitration Tribunal that is currently underway in London? That bears upon today’s proceedings because the application for an injunction that the Belize Bank had made is a mirror copy of a preliminary ruling they had already received form the arbitrators. Young told us that even though Government isn’t participating in the proceedings, she is confident that the Arbitrators will rule in Belmopan’s favour. The Belize Bank initiated arbitration in England last October, alleging that the Government was in breach of a valid agreement. On that basis, the Bank has asked for a list of declarations as well as damages.
Lois Young,
“Damages because they are saying the government repudiated which is saying we are not bound by the settlement deed so what they are saying is we want the government to pay us damages in the form of all the taxes that we would have not paid over the next how many years; 100 years, 50 years, I don’t know how long. But that can only be if your agreement is valid. Look the thing is so obviously unlawful that even if the tribunal continues ex-parte I can’t see how they can’t see that. It is obvious; it is as simple as ABC. I sat down with the Commissioner of Income Tax and we went through it. It was as clear as ever it is unlawful. So even if it is ex-parte, I believe that the decision has to be that it is unlawful. I mean you didn’t have force it through a little hole, you didn’t have to turn it around or twist it around, their reasoning, one and one could not make three. It is as simple as that; one and one can only make two.”
Kent Clare, Income Tax
“To us the issues were clear from many years ago but we’re finally glad that we got judgement and we look forward to the next $5.7 million tomorrow morning.”
Janelle Chanona,
“Mr. Clare some people might be thinking that the Income Tax Department knew about these things from a long time ago. Why wait for the change of government to begin pursuing them?”
Kent Clare,
“Some of that I can answer, some of it I can only speculate. The thing about it is like I said these were very very clear issues. No way they should have been entangled in court for such a long time or even have held in abeyance for such a long time. But I would prefer other persons who have a better knowledge of what happened behind closed doors for them to comment on to why we did not take issue with these issues a long time ago. It is long overdue, this is money that is not due now. It was due years ago.”
According to Clare, even after their five point seven million dollar payment tomorrow, the Bank will still owe the Government of Belize another one point three million in unpaid taxes. Legal proceedings for those monies are expected to be filed shortly.
