Cars For Free

More exemptions for privileged investors

The fifteen luxury BMWs allowed out of the port without any duty having been paid
The fifteen luxury BMWs allowed out of the port without any duty having been paid

There is no end to the system of exemptions and concessions accorded to privileged investors by President James Michel. Last week 15 BMW luxury jeeps arrived in the country from Abu Dhabi, and are being cleared of all customs dues or Goods and Services Tax (GST). All that is being paid for the imports is R25 documentation fee.

These vehicles are valued at over R2 million each. The duty, GST and special levy on vehicles would have amounted to around R900,000 on each. The total which President Michel has therefore donated on behalf of the country is around R16 million or US$1.6 million.

It is not clear who the vehicles are actually for. The Plantation Club? Four Seasons? Sheikh Khalifa? Some of them, probably five, may be given to the Government.

They are the latest example in a mountain of imports which have ben made by the Arab investors free of all customs dues or Goods and Services Tax (GST). They are probably not the last. The Four Seasons has already had a consignment of limousines under the same conditions and certainly Sheikh Khalifa will have an even larger fleet, under diplomatic privileges, when he is ready to take residence in his new palace.

Apart from the tax losses, some car dealers in the country have been concerned about the implications for agency import privileges. The local BMW dealer Executive Motors Limited said that they were never contacted and were not involved in the importation of these vehicles. This proves once again that the privileged investors are not interested in the local economy.

The arrangement for some vehicles to be given to Government shows exactly the kind of arrangement that blurs the lines. Government is not there to engage in trade-offs of vehicles in the place of appropriate taxes.

The quantity of dutyfree imports for which Sheikh Khalifa has benefited in relation to the two palaces under construction, at La Misere and Barbarons, has reached astronomical proportions. It has been estimated that customs duty and GST on materials for the construction may well have amounted to US$150 million, which would surpass all the well-publicised donations made by the Sheikh.

But whereas these privileges are personal to him, the donations made to Seychelles for various projects have been from the state of Abu Dhabi. The donations have been openly used by the Presidents and Ministers as justification for the extraordinary privileges that the Sheikh has been accorded but the projects for PUC generators, power lines and new water treatment facilities at La Misere are first and foremost for his own convenience.

If the Sheikh enjoys diplomatic immunity to that degree, it is clear he will be bringing in an army of servants from overseas as well and importing all the goods for his homes duty-free in the years to come. In a country with accountable government, President Michel could well have been impeached for such actions. It is a good question whether he has the power to make these kinds of concessions u

nder the excuse of diplomatic privileges. In any case, what happened to the IMF rule of ending exemptions and concessions?

President Michel should face a public inquiry into this situation and should answer allegations being made that he has benefited personally from the concessions he has been giving to the Sheikh and other privileged investors. This is a relationship that has reached troubling proportions for Seychelles.

Source: Regar 3-5-10