According to the Commissioner of Income Tax Kent Clare, the Coyes owe over $3 million in back taxes
The successful appeal of the Coye family and their company Money Exchange International which resulted in the overturning of their conviction of money laundering charges at the Court of Appeal last week meant that government was mandated by the ruling to return the funds it had frozen, but now the Income Tax Department has stepped into the picture, claiming that the Coyes owe millions of dollars in unpaid taxes.
In their decision, the Court of Appeal Justices gave the government 60 days to return the 1.557 million dollars that police seized from the Coye’s Johnson Street resident on December 31, 2008.
But that was not all the money that the government had frozen when the Financial Intelligence Unit (FIU) began its money laundering proceedings. Apart from the personal accounts of the Coye family, all of the family’s company’s account, amounting to some 6.5 million dollars, had been frozen.
Attorney for the Coye family, Arthur Saldivar, revealed on Wednesday, March 12, that the Income Tax Department is claiming 3.2 million dollars in back taxes from his clients.
According to the income tax assessment papers that were given to Saldivar, when he approached the new FIU Director, Eric Eusy, who is a former Commissioner of Income Tax, the figures on the forms are claiming 3.2126 million dollars in back taxes.
The three assessment papers are for the estate of Michael Coye, his daughter Melonie Coye and their company Money Exchange International and are dated March 5, 2014.
In an interview with 7 News and Amandala, Saldivar declared: “The Coye family was never served with this assessment.”
“Under the law, Section 58 of the Income Tax Act, the Income Tax Commissioner can make a garnishment of monies for debt owed through a third party or to a third party. In this particular case, it was the FIU that received the letter. Now, it is still unclear: what is the measure of assessment used to come up with the figure that Income Tax has come up with? But, certainly, in any reasonable contemplation, 3.212 million dollars is excessive. Where you have no basis for an assessment, there can be no other description to define what has taken place other than arbitrary, both of which does not reconcile with our system of law, and both of which offends basic fairness,” said Saldivar.
Saldivar said that the only explanation that he can come up with is that “you’re using the tax system as a means to punish a person.”
He added, “So, the courts have found the accused persons in this matter not guilty, but the tax man is making a punitive judgment.”
Saldivar said that he has prepared applications to show to the authorities that the Coyes don’t owe income tax.
Saldivar also said that some of the monies that the FIU case caused to be frozen have nothing to do with the case. It was only the 1.557 million dollars that the FIU and police removed from the Coye’s home that was directly connected with the case.
That, however, is not what Kent Clare, the Commissioner of Income Tax, is saying. Commissioner Clare told 7 News that the assessments refer to monies that the Coyes never paid to the Income Tax Department while doing business.
According to Clare, the assessment is not as oppressive as Saldivar has contended. Clare said, “The assessment was made under section 111 (3) of the Income and Business Tax Act. That section reads, ‘Where it comes to the notice of the Commissioner that a person or entity has not reported or disclosed any receipts which ought to have been reported or disclosed, such unreported receipts shall be taxed at the rate of 50% of such receipts, in addition to any other penalties leviable under this Act or regulations made thereunder”
Asked what legal recourse is left to his client, Saldivar said the most likely remedy is a judicial review.
He also indicated that the FIU is planning on appealing the Court of Appeal ruling to the Caribbean Court of Justice.
Amandala has tried to reach FIU Director Eric Eusy, but our efforts have been futile.