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Director of the BTS Says There Are Hundreds of Millions of Dollars of Uncollected Taxes

There are also hundreds of millions of dollars of uncollected taxes. For the past decade or so, the government failed to collect more than six hundred million dollars in taxes. More than eighty percent of that is statute-barred, meaning that the government won’t be able to collect and which means it was a gigantic loss. The government is currently putting together a Tax Recovery Unit and today, Director of the Belize Tax Service Michelle Longsworth gave us an update.

Michelle Longsworth, Director, Belize Tax Service: “The overall when we last looked at it it was six hundred and forty something million. Now you have to understand that these are tax arrears that came over from the two departments. What happened is that only books you will find tax arrears for sales tax. We know sales tax has been out, for VAT. So this tax recovery unit what they will do now is focus on cleaning up that tax, taking out these things. The process for us to take taxes off our books it has to go to parliament. So parliament has to approve for us to remove any tax arrears from our account and I think that is –“

Reporter: What’s already statute barred correct ?

Michelle Longsworth, Director, Belize Tax Service: “Yes. So you know sales tax and VAT has not been around for awhile but these are still on the books right and so the tax administration now our officers will be focusing on cleaning up that tax and then presenting a true picture of what our real arrears is and how we will proceed to collect those arrears, that is what the tax recovery unit will be focused on now.”

Reporter: So at what point does it become statute barred because I believe the over six hundred million dollars in taxes I believe over eighty percent of that is statute barred. 

Michelle Longsworth, Director, Belize Tax Service: “Yes from our initial analysis we have eighty percent of that debt that is older than five years. And in any calculation that you use you know that when you look at it the depreciation – I use the word depreciation but the collectability of it is very low after you pass thirty days, sixty days, a hundred days you have a formula that you use to know what is collectable and what is not. So that eighty percent that is greater than five years we deem that those will be uncollectible.”

Reporter: And efforts were made to collect that money ? 

Michelle Longsworth, Director, Belize Tax Service: “That is – in order for us to take it to parliament we have to show that efforts were made to collect it. They won’t just write it off so we have to go through the books to say was an assessment served? Was it taken to court ? Did you try to find that person ? Is the person dead ? Did they file for bankruptcy ? that kind of thing so we have to do our due diligence before we can just say ‘Oh write this off.’ that’s not going to happen.”