Sandals Claims TCI Owes It ‘Millions’ In Overpaid Taxes

CMC News:-  PROVIDENCIALES, Turks and Caicos Islands – The Jamaica-based Sandals Resorts International (SRI) says its Beaches Resort Villages and Spa in the Turks and Caicos Islands (TCI) has met all its tax liabilities to the authorities here and in fact is “owed millions of dollars in overpaid taxes”

Earlier this week, the TCI government said it hopes to bring to an end “a critical outstanding matter” that has been outstanding ever since the SRI-owned facility began operations here.

The resort has announced its “indefinite” closure of its facilities here from January 2021 and the government has promised that it will be “fully transparent” on the matter amid media reports that the issue is linked to a multi-million dollar tax bill.

Premier and Finance Minister, Sharlene Cartwright-Robinson, said her administration has been addressing the long outstanding issue with Beaches and she remains confident that with the facts in full view, we can bring an end to a critical outstanding matter that has seen its basis in an arrangement in place since the Resort’s operation started in the 90s and existed throughout every government in the TCI since then.

“I assure the people of the TCI that this matter will be settled in the very best interest of all the people of the Turks and Caicos Islands. I ask those employees of Beaches, taxi drivers, other Hotel operators, airline agents and airline workers who contacted me frantically for representation to know that they are being held in highest consideration,” Premier Cartwright-Robinson.

She said she was imploring “those void of facts to resist casting wild accusations and unwarranted attacks on elected and public officials as well Beaches Resort itself,” as she praised public servants “who brilliantly crafted the most appropriate solution at the very outset”.

In its statement, the SRI said that Beaches TCI has operated here for the past 23 years and has “punctually and accurately paid taxes according to law.

“As a matter of fact, we are the first in line to pay our taxes. To the contrary, it is Beaches Resorts that is currently owed many millions of dollars in overpaid taxes,” SRI said, noting that prior to  2016 Beaches TCI underwent several tax audits by the TCI Tax Department which always resulted in a clean sheet.

“However, in 2017 the Tax Department, in disregard of the prevailing legally binding agreements in writing, unilaterally and unlawfully imposed additional taxes and penalties at a preposterously crippling rate of 10 per cent per month, compounded, which translates to more than 213 per cent per annum. Let us be clear — the company invested in the TCI on the strength and assurance given by the Government in legally binding agreements.”

SRI said that the government “has acknowledged the injustice and has undertaken to remedy the egregious wrong but, in spite of assurances, has been unable to do so for over two years”.

“While not a comfortable position, Beaches TCI was forced to take legal action against the TCI Government for breaches of the binding agreements,” SRI said, adding “we are heartened by the Premier’s statement that this very serious matter is engaging the attention of Cabinet, which we are hopeful, will protect our guaranteed written rights as was agreed”.

Media reports said that the government taxes owed by the hotel are in the vicinity of US$60 million and that discussions to settle the matter have been ongoing for some time.

In an earlier statement, the resort noted “the upcoming closures of Beaches Turks & Caicos are the result of several critical and long-standing issues which have impacted our operations over the past several years”.

“We apologise for any inconvenience caused to our customers and look forward to welcoming them back soon,” it added.

4 COMMENTS

  1. The business of Taxation is essentially an “exact science ” , for want of a better term. It is really a simple equation. You operate and earn income within a jurisdiction. You incur tax liability. The quantum is either assessed by the Tax Authorities , based on your declared financial “performance”, and/or ideally based on your declarations ( tax returns)- or both processes. If there are inconsistencies or discrepancies, you are audited and your actual tax liability is determined. You pay your taxes, albeit either through proforma remittances or, in lump sum at the end of your financial “year”. In the event that you are deemed to have overpaid taxes through the aforementioned pro forma , reconciliations/offsets can be established between the Tax Agency and your company.For all business intents and purposes you are not going anywhere- your business operations will carry on. The Government is not going anywhere- the collection of taxes will carry on into the future , so-to-speak.Surely the Sandals Management is mature and intelligent enough to know that the reimbursement of overpaid taxes is not usually readily forthcoming, simply because the Treasuries of our small economies are invariably constrained from issuing tax refunds with immediate effect. Surely there can be amicable resolution to this demise. Why then is there such an impasse between a Corporation that professes to operate by an ethos of goodwill and good Corporate Citizenship , and a Government that professes good intentions towards Investors , for the sake of national development. I would suggest that the two “entities” are allowing themselves to get bogged down in counterproductive bureaucracy. Both the Sandals Shareholders and the TCI population (particularly the numerous people who depend on the Hospitality Industry for their livelihoods and sustenance) deserve better than that.

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