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Businesswoman claims she is being penalised by Government over pension legal row

Shi-Vaughn Lee (Photograph by Akil Simmons)

A young entrepreneur claims she has been “targeted” for challenging the Government over its refusal to grant her Covid-19 social insurance relief.

Shi-Vaughn Lee, owner of Dove & Butterfly, alleged that customs officials charged her too much in duty for a car she imported and then “threatened” to withhold skincare goods she was bringing in for Valentine’s Day if she did not pay.

Ms Lee claimed she was being penalised by the Ministry of Finance because of an ongoing legal row over her company’s contributory pension payments.

But a government spokeswoman denied any “hostility or threats”, insisting the duty rate was correct and noting that the Collector of Customs could refuse delivery of goods to anyone who had failed to pay duty on previously imported goods.

The customs issue was raised in the House of Assembly on February 3 by Ms Lee’s grandfather Derrick Burgess, the Deputy Speaker – though he referred to her as a “businesswoman” and did not identify her as his relative.

Ms Lee told The Royal Gazette: “He is watching on the sidelines what’s happening. He doesn’t want to have any type of interference but at the same time it is ‘enough is enough’ when they said they would hold on to the shipments.”

Government backbencher Derrick Burgess brought the plight of entrepreneur Shi-Vaughn Lee to the attention of Parliament – but did not tell MPs she was his granddaughter.

The Deputy Speaker claimed on February 3, during the motion to adjourn, that civil servants were “threatening” people.

He said a businesswoman he knew was being “penalised” by them.

Mr Burgess, a former Cabinet minister and president of the Bermuda Industrial Union, said: “They went as far as to put it in writing, threatening this lady, if she didn’t pay these funds by today, they will hold up her shipment. Putting her livelihood at risk.”

He added: “They put her through pure hell. H-E-L-L – Hell.”

His comments were later branded “disturbing” by the Bermuda Public Services Union, which denounced the “wide-sweeping vilification of public officers in the House of Assembly and in the press”.

Dennis Lister, the Speaker, told the Gazette he would not discuss in the public domain anything that happened in the House of Assembly and would not comment on this matter.

Mr Lister said the rules of the House specified when members should declare an interest. The standing orders require MPs to make such declarations when a vote is being taken.

Ms Lee launched her company in June 2020 at the height of the pandemic. The Government passed legislation that year allowing the suspension of social insurance payments between July 1, 2020 and June 30, 2021 to give relief to struggling employers and employees.

Ms Lee was initially unaware of the scheme but when she found out about it she applied in November 2021.

That same month, she had received a bill from the Department of Social Insurance, seen by the Gazette, which included a note telling recipients to contact the Government via e-mail or telephone “for suspension of contributions” for the yearlong period.

But Ms Lee’s application was rejected by the Director of Social Insurance, who told her the deadline to apply had passed.

Ms Lee, a qualified lawyer who did her pupillage in the Ministry of Legal Affairs, said at that point, “I put on my legal head and said ‘what deadline?’” because the legislation passed in 2020 did not contain one.

She appealed the refusal of relief to a Contributory Pensions Appeal tribunal, which agreed in June 2022 that “there is no express time frame for a person to apply for suspension of his contributions under the 2020 Act as read with the principle 1970 Act”.

The tribunal ruled that the Director of Social Insurance should forward Ms Lee’s application for relief to the Minister of Finance for his consideration.

The acting financial secretary wrote last August to say legal advice had been obtained stating there was “no scope” for an application to be made to the finance minister and could only be made to the social insurance director, despite the tribunal ruling.

The Director of Social Insurance still insisted the deadline to apply was June 30, 2021.

The Contributory Pensions Temporary Amendment Act 2020 enabled the suspension of social insurance contributions by companies, workers and the self-employed.

The suspension period was defined in the legislation as from July 1, 2020 to June 30, 2021 but there appears to be no reference to a deadline for applications.

In contrast, the payroll tax rebate had an advertised deadline for applications of December 15 last year.

There was also a clear October 31, 2022 deadline for the $150 relief for parents and guardians of public school students.

The Government has allowed two temporary occupational pension refunds – the first had a deadline of June 30, 2022 and the present one has a June 30, 2023 deadline.

A government spokeswoman told the Gazette: “While the Ministry of Finance cannot comment on individual Covid-19 social insurance relief applications, we can confirm that the legal time frame to apply for suspended social insurance contributions was from July 1, 2020 to June 30, 2021.

“Applications were vetted for accuracy and eligibility. Persons were advised to appeal to the Contributory Pensions Appeals tribunal if they were aggrieved by a decision.”

Ms Lee tried and failed to get leave for a judicial review of the director’s insistence that there was a deadline. She was ordered to pay the Government’s legal costs by a Supreme Court judge last month.

The 27-year-old is still fighting the director’s decision and wrote to the tribunal chairman last month asking for a new, enforceable ruling.

“To me, it was like, why are you putting someone through the ringer over an amount of about $5,000 and you are giving away millions,” Ms Lee, who has an eight-month-old son, said.

“It’s a lot of money to me because I’m an entrepreneur and I have got a lot of responsibilities. Not only that but the relief was only for me, it wasn’t for no employee.”

Ms Lee imported a Mercedes Benz car for picking up supplies and making deliveries for Dove & Butterfly at the end of last year.

The Customs Department told her she must pay customs duty on it as a light passenger truck – which is how it was licensed by the Transport Control Department – meaning a charge of $21,000 on a car she bought for $18,600.

Ms Lee alleged she was being “targeted” because of the social insurance row and knew of other business owners who brought in similar vehicles and were licensed in the same category, yet paid a concessionary 35 per cent rate applicable to non-passenger vehicles used to transport goods.

The car was released by Customs on December 19 but not licensed until January 11 and Ms Lee believed the duty would be due 30 days from the latter date.

But an e-mail to her from a customs officer on January 31 said outstanding duty was due on the car by February 3.

The officer wrote: “Further imports of goods for Dove & Butterfly will not be delivered by Customs until the due and any other charges on the vehicle have been paid.”

Ms Lee paid the fee in a “panic” to ensure her Valentine’s Day stock was not held up. But she accused the officer of “hostility, threats and aggression”.

The government spokeswoman said: “Customs assesses and collects duty under statutory functions. In this case, the vehicle does not qualify for the 35 per cent duty rate … because it has been registered with the Transport Control Department as a light passenger truck.”

She said the correct rate was 75 per cent on the first $10,000 and 150 per cent on the value above $10,000, adding that the Collector of Customs could refuse delivery of goods to any importer who failed to pay duty on previously imported goods within 30 days of “delivery”.

The spokeswoman said warnings of “potential stoppage of further shipments” could be sent out. She added: “Such notifications are not acts of hostility or threats but statements of fact and intention under statutory authority.”

• Have you been affected like this? Let us know – e-mail news@royalgazette.com

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Published February 17, 2023 at 9:29 am (Updated February 17, 2023 at 9:30 am)

Businesswoman claims she is being penalised by Government over pension legal row

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