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The Court of Ap­peal has or­dered the Board of In­land Rev­enue (BIR) to re­fund US$481,724.21 in over­paid tax­es to two for­eign com­pa­nies, af­ter find­ing that the tax au­thor­i­ty had been un­just­ly en­riched.

In a writ­ten judg­ment de­liv­ered by Jus­tice of Ap­peal Ricky Rahim, the court over­turned a 2023 de­ci­sion by Jus­tice Lam­bert-Pe­ter­son, who had pre­vi­ous­ly re­fused to grant an or­der of man­damus for the re­fund. The ap­pel­lants, HMV In­ge­nieros LT­DA and HMV En­gi­neer­ing Cor­po­ra­tion, suc­cess­ful­ly ar­gued that the BIR un­law­ful­ly re­tained funds that were nev­er sub­ject to tax un­der the In­come Tax Act.

The dis­pute arose from a con­tract be­tween the ap­pel­lants and the Trinidad and To­ba­go Elec­tric­i­ty Com­mis­sion (T&TEC). Be­tween 2013 and 2016, T&TEC de­duct­ed and re­mit­ted with­hold­ing tax to the BIR on pay­ments made to the com­pa­nies. How­ev­er, the ap­pel­lants con­tend­ed that US$348,373.84 of those pay­ments were for the sup­ply of goods, while the re­main­der con­cerned ser­vices per­formed en­tire­ly out­side of Trinidad and To­ba­go. Un­der Sec­tion 50 of the In­come Tax Act, such pay­ments do not at­tract with­hold­ing tax.