Tonight, David Gegg, one of the big names in the Belize Tourism sector, is breathing easier after he dodged a committal warrant to prison today. It's for non-payment of General Sales Tax, and Gegg's company, it is alleged, owes almost a quarter million dollars!
The precise figure according to the General Sales Tax Department, is ($206,639) two hundred and six thousand, six hundred and thirty nine dollars in arrears.
This matter was taken before Magistrate Kathleen Lewis this morning in the Municipal Court by the GST Department because according to them, his arrears had once climbed to more than three hundred thousand dollars.
Now, usually, the person whose name is printed on the warrant is the one who's supposed to show up in court. But, Gegg didn't appear today; instead, he sent his accountant, Sheffield Eck, to appear on his behalf.
GST Legal Officer, Jacqueline Meighan, explained that an order on was given over a year ago for Gegg to pay off ($264,000) two hundred and sixty-four thousand dollars in arrears dating back to December 2010 for his 2 businesses, Cruise Solutions and Discovery Expeditions.
Meighan said the court gave him a realistic payment schedule, which he agreed to on that date, but he didn't honor his side of the agreement - paying only ($67,000) sixty-seven thousand dollars - a quarter of what he agreed to.
But it's been a few months after those arrears were calculated, and to date, he has an additional ($159,700) one hundred and fifty-nine thousand, seven hundred dollars which is also now in arrears.
As a result, Meighan said that her instructions from the superiors at the GST Department were to press for the court to order that he pay half of those new arrears forthwith, and then settle the rest in monthly installments.
She told the court that based on the returns filed by these companies, the information suggests that Gegg was more than able to honor the payment schedule, but he has a history of making promises to the department, and then forgetting about his commitments.
According to Meighan, his history suggests that he really only makes an effort to pay a part of the arrears when there is the threat of a legal action hanging over his head.
Magistrate Lewis also heard submissions from Eck, the accountant, who said that although the returns filed suggests that they are making as much profit as being reported, the actual cash in hand from the profits is less due to other unbudgeted expenses which come up.
Eck told the court that as the accountant, he has, on numerous occassions, strongly advised Gegg to file for bankruptcy and try to clear up his debts, but Gegg has so far refused to do so.
He also explained that Gegg was in the process of getting a loan, and he would be able to settle a part of the arrears by the end of the week. As a result, he asked for more time so that this loan process could be completed.
Magistrate Lewis, after considering both positions, ordered that Gegg must pay $80,000 toward the new arrears by December 21, and then the rest must be paid in installments agreed by both sides.
So, with that, Gegg got some relief on the current arrears, but the committal warrant for his detention on the previous arrears was still in effect. Reports are that when police officers tried to execute the warrant and detain Gegg this afternoon, he locked himself in his office and refused to come out.
Immediately after that, his accountant made a good faith showing by making a payment of $50,000 to the court this afternoon.
The accountant also met with the magistrate who would have heard the matter this afternoon, and the magistrate informed him that Gegg must appear in court to answer to the warrant so that a payment assessment can be done.
So, this matter goes back before the court tomorrow at 9 a.m., where Gegg must appear in person.
Owed GST lands businessman David Gegg in Court
Belize City businessman David Gegg, proprietor of Cruise Solutions and Discovery Expeditions, today evaded a committal warrant for failure to pay General Sales Tax. The GST Department wanted Gegg for non-payment of almost two hundred and six thousand, six hundred and thirty-nine dollars in taxes. In court this morning, GST Legal Officer, Jacqueline Meighan, explained to Magistrate Cathleen Lewis that an order was issued at the end of September 2011 for Gegg to settle arrears of two hundred and sixty-four thousand dollars in back taxes for the two businesses. Meighan further told the court that Gegg was given a reasonable payment plan during which he could have paid off the mounting debt. But up until this morning Gegg had only paid sixty-seven thousand dollars of the total owed. Meighan pressed the court to order that half of the new arrears, an additional one hundred and fifty-nine thousand, seven hundred dollars which has accrued since last year, be paid up front. Gegg, who wasn’t in court today, was represented by accountant Sheffield Eck. Eck told the court that on numerous occasions he advised Gegg to file for bankruptcy in an effort to clear his debts. According to Eck, the returns filed suggest that the company is profitable; however, the actual profits of the businesses are significantly less due to unforeseen expenses. Gegg, he said, was in the process of securing a loan which he would use to defray a portion of the GST bill by the end of the week. With that he sought an extension from the court until the end of this week. Magistrate Lewis subsequently ordered that eighty thousand dollars be paid by December twenty-first, and the balance paid in installments. This afternoon Eck made an initial payment of fifty thousand dollars, presumably as an act of good faith. Gegg is to appear in person before the court on Wednesday morning to answer to the committal warrant in order for a payment assessment to be conducted.