Tax Administration Jamaica (TAJ) says its lease arrangement for two unoccupied properties is in accordance with Government procurement policy.

This is in response to a report from the Auditor General which indicated that the TAJ spent over $371 million on properties it leased but has not yet occupied, in Manchester and St Mary.

In a statement last evening, the TAJ explained that the policy requires a lease to be in place before commencing the process to procure technical service and to renovate.

The TAJ said once the lease is in place, the entity is liable to make payments.

It said the delay in occupancy is attributed to the lengthy procurement process and build out required to make the space suitable for the delivery of tax services, which in the instance of Mandeville had to be restarted and both are still ongoing.

As it relates to the property in Mandeville, the TAJ said the procurement process for renovating the space of the size leased for the RSC operations requires Cabinet’s approval and a consultant to manage the project.

It therefore means this process has two separate procurement processes which cumulatively can take up to 14 months for completion.

It said the lease arrangement for this location was handled by the National Land Agency with the process commencing on April 13, 2018, and the lease agreement duly signed by the lessor and TAJ and completed in September 2020.

The initial bidding process failed because four more contractors were added to the process.

The competitive bidding process is being pursued and may take another 6 months to engage the contractor.

Projections are that the work will take a minimum of 12 months to complete and indicates September 2025 at best.

As it relates to the property in Annotto Bay, the TAJ explained that a former bank was identified as an ideal building to relocate the Annotto Bay tax office, which was deemed to be in need of major repairs.

TAJ said upon taking possession of the keys for the premises in January 2022 and entering the space, it was evident that changes were made to the layout of the space.

Consequently, in February 2022, a letter was sent to the owners requesting that the space be restored to its original state.

In keeping with Government procurement policy, the process to build out, occupy and open the space cannot commence until a lease agreement is duly signed.

This process that is currently in progress, involves several steps, which will take months to complete.

TAJ also explained that the existing Annotto Bay tax office has been closed since the earthquake in November 2023, as the quake worsened the poor condition of the building, and a structural engineer’s report rendered it unsafe for occupancy.

The TAJ said it had already leased the new space and the engagement of the contractor is at the evaluation stage.

Based on the timelines, the Annotto Bay tax office should be open for business at the new location, within the second quarter of the upcoming fiscal year.