TT Gov't owes Unipet $134 million in VAT
Paria chairman Newman George
Renuka Singhn / TT Guardian
Petroleumworld 12 09 2019
The Government owes Unipet more than $100 million in unpaid VAT refunds and gas subsidies.
Guardian Media learned on Saturday that the the Government's outstanding bill is the crux of Unipet's legal case currently builing against the State.
According to information received by a senior Unipet executive, the Government owes the private company $74.4 million in gas subsidies and another $59.2 million in VAT (Value Added Tax) refunds—a total of $133.6 million.
Guardian Media could not confirm in what period the Government racked up that debt.
It was this debt that kept the "good faith" agreement and continued delivery of fuel going between Paria and Unipet for such a long time.
Under the government subsidies, Paria sells to NP and Unipet fuel at a price. Let's for simplicity sake say that cost is $100—NP and Unipet can only sell to customers for $80 because of price control on fuel. The Government then pays Unipet and NP the difference of $20 which is called the subsidy. Because of the line of credit, it is assumed that by the time NP and Unipet are required to pay their bills they would have gotten their subsidy to pay the full $100 which would comprise the $80 they got from the gas stations and the $20 from the Government.
Therefore, the subsidy is really for Unipet to pass on to Paria since in effect it is only responsible for the $80 it got for selling the fuel.
It means if the Government is late in paying the $20 to Unipet and NP, it can be short on paying Paria.
Last week, during the impasse between Paria and Unipet, Finance Minister Colm Imbert revealed that Unipet had racked up a massive bill with the fuel trading company.
On Friday during his contribution to the debate on the Finance Bill in the House, Prime Minister Dr Keith Rowley blasted Unipet for the unpaid bill.
Rowley said then that the Opposition was busy trying to portray Unipet as the victim instead of insisting that the private company pay off its debt to the State.
Rowley made no metion then of the money that the State owed the private company.
He said that there was a sense of entitlement in this country even when a company was being "ridiculous and unproductive."
Rowley said then that it was the taxpayers who had to foot the bill for lawyers because Unipet had filed an injunction to end the standoff with Paria.
On Tuesday, Paria stopped its supply of gas from all 24 Unipet gas stations. Since then, there have been long lines at the NP gas stations as the Unipet supply dried up.
Several of the Unipet stations remained closed on Saturday.
In a statement on Tuesday, Paria said it decided to cut off Unipet's fuel supply because the company failed to renegotiate a supply agreement since April 2019.
On Thursday, Guardian Media spoke exclusivly to both the curent and the former chairmen of Paria and both men confirmed that there was never any deal between Paria and Unipet, there was only an " agreement."
George: Subsidies owed to Unipet is not in contention
Current Paria chairman Newman George told Guardian Media than that there was an unsigned agreement which allowed the continued supply to Unipet without a payment.
That agreement would have been put in place when the company began a business in 2018 under former chairman Wilfred Espinet.
Espinet on Thursday told Guardian Media that he was not sure what happened between Paria and Unipet but speculated that the invoices were not paid on the dates that it was due.
Espinet did not say whether Unipet ever defaulted payments under his watch.
George yesterday contested Unipet's claims that it is owed a gas subsidy.
George, who is out of the country, said that he has not been "following" the issue as his WiFi was intermittent.
"I cannot confirm what VAT refund is owed by the Government to Unipet and that is an issue for the Government and not Paria," he said. "The subsidies owed to Unipet is not in contention as that refund of the subsidies to Unipet when received is forwarded to Paria," he said.
He did not respond to subsequent questions.
Finance and acting Enegy Minister Colm Imbert did not respond to either calls or texts to his mobile phone. Permanent Secretary Vishnu Dhanpaul did not respond either.
We invite you to join us as a sponsor. Circulated Videos, Articles, Opinions and Reports which carry your name and brand are used to target Entrepreneurs through our site, promoting your organization’s services. The opportunity is to insert in our stories pages short attention-grabbing videos, or to publish your own feature stories.
Story by Renuka Singhn from TT Guardian
guardian.co.tt / 12 08 2019
Copyright© 1999-2019 Petroleumworld or respective author or news agency. All rights reserved.
We welcome the use of Petroleumworld™ (PW) stories by anyone provided it mentions Petroleumworld.com as the source.
Other stories you have to get authorization by its authors. Internet web links to http://www.petroleumworld.com are appreciated.
Petroleumworld welcomes your feedback and comments, share your thoughts on this article, your feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to firstname.lastname@example.org
By using this link, you agree to allow PW
to publish your comments on our letters page.
Any question or suggestions,
please write to: email@example.com
Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels