Blacklist threat part three and four

UPDATED: There are now two more wake up calls for Cayman. First, the announcement on 28 October 2008 that Australia and the British Virgin Islands have entered into a tax information exchange agreement (TIEA).

Second, the rather opaque comment made by the Jersey director for international finance that behind the scenes Jersey is in a “different position than the headlines suggest”, i.e. it is also busily negotiating TIEA’s.

What can we glean from these two events? First, other competitor jurisdictions are apparently rather ahead of Cayman in recognising the clear and present danger of OECD blacklisting (and possibly other prejudicial action). Second, they are actually doing something about it in a timely fashion. Third, they are getting results that should stand them in good stead.

The well-documented threats from the USA are real, but Cayman can do nothing to stop the likely changes to US domestic tax laws should Senator Obama be elected President. On the other hand Cayman can and must do something about the threats from the EU and the OECD. That is where the focus of the Government and private sector A Teams should be right now.

The final wake up call to Cayman came Wednesday with the very public and photographed signing of a tax information agreement between the British Virgin Islands (one of our key competitors) and the UK at the OTCC meetings in London. It is an extreme embarrassment to Cayman for such an obvious message to be delivered by the UK in such a public way. The community should be asking its Government how much longer does Cayman have to wait for real action and real results in the international arena? Time is fast running out.