Hotel owners accuse state of tax ruling sabotage

Suncrest Hotels plc yesterday filed a judicial protest in the First Hall of the Civil Court claiming damages from the authorities.

The company filed its protest against the Commissioner for Value Added Tax, the Director of Customs and Excise and the VAT Appeals Board.

The company claimed that the state was sabotaging a decision that had already been taken in its regard. Suncrest Hotels referred to an issue of tax allegedly due by it for VAT and CET. The tax department had appointed an auditor to examine the returns submitted by the company for the two tax systems.

In May 2003 the VAT and CET departments had told the company they did not accept the assessments submitted. Suncrest Hotels then filed an objection under the CET procedures and requested a review in terms of VAT legislation.

Following the review, the VAT Department reduced its estimate of VAT and CET allegedly due by the company by Lm267,229 from the original estimate of Lm435,146. The CET Tribunal upheld the appeal lodged by the company in June last year.

Suncrest Hotels said the facts examined by the tribunal were identical to the facts that were important for the VAT issue too. But, despite the fact that the merits of the case had already been decided upon by a final judgment, the VAT Appeals Board was once again to examine the VAT issue. The company claimed that this was a clear case of sabotage on the part of the state, for the authorities were abusively making use of proceedings.

The VAT Appeals Board was refusing to consider the company's claim that the merits of this case had already been decided upon in a final manner, and the company claimed that the authorities' actions in its regard were illegal and an abuse of power.

The company therefore held the authorities responsible for damages.

Lawyer David Wain signed the protest.