Archive for November, 2010
Cayman tax sytem unfair, says local recruiter
(CNS): During a panel discussion organised by Generation Now a local recruiter pointed out that indirect taxation is unfair on the poorer members of society. In the second of its public forums on controversial topics, the critical thinkers brought together Paul Byles, Anthony Travers, Tom McCallum and Steve McIntosh to discuss the country’s tax system. While Travers, the chair of Cayman Finance, argued that direct taxes would drive away business and economist Byles said they would be too difficult to collect in a mobile population, McCallum of McCallum Consulting said jurisdictions such as Jersey were thriving on direct taxes and recruitment expert McIntosh pointed out that indirect taxes were regressive and created a disconnect between the voters and government accountability.
Aside from being unfair to those at the bottom of the socio-economic pile, since indirect tax systems mean they pay a greater proportion of their earnings to the government coffers, McIntosh, the CEO of CML Offshore recruitment, pointed out that people don’t realise how much tax they pay when they are indirect. “Indirect taxes are regressive and unfair; people on low incomes pay proportionately more than those on higher incomes,” he said. He also wondered whether government would still be building a $9 million hurricane shelter on the Brac if people realized what proportion of their income they actually pay to government coffers.
McCallum, a consultant who assists people with business advice, pointed out what this means for the democratic process. “There is also a big disconnect between the electorate and government. Voters reward politicians for spending money. We do not hold our politicians accountable as we do not feel we are paying.”
Both McIntosh and McCallum suggested that, without a tax bill or a salary slip where the tax from one’s earnings was clearly indicated, people don’t see the money government is spending as being theirs. People who pay direct taxes and see how much they are paying from their earnings tend to be more critical of government overspending.
However, Travers argued that the very fact that Cayman does not have income or property taxes is why business comes here in the first place and the indirect tax system was fundamental to the success of the Cayman economy. “So tinker with the tax system at your peril,” Travers warned.
Byles, chair of the Development Bank’s board and MD of Focus Consulting, noted that the cost and difficulties of collecting direct taxes with such a mobile tax base would make it prohibitive. The economist and author said that the transient nature of Cayman’s workforce was unique and no other country in the world was dealing with a situation where half its workers were foreign nationals. “Any tax system mostly take two things into account – how easy is it to collect and how easy is it to avoid?” he added.
While there was a clear divide between McCallum and McIntosh on the one hand, who said they wanted to see a broadening of Cayman’s tax base to reduce some indirect taxes and introduce some direct ones, and Byles and Travers, who were both opposed to direct taxes, all four men agreed that government spending was too high and had to come down. Travers, however, said there was some evidence that this current administration was reducing operating expenses and, as a result, Cayman Finance would be advising government to reduce the recent increases in business fees, which he said were a temporary measure.
The debate took place at the Harquail Theatre on Thursday evening and was organised by the local non-profit organisation, Generation Now, a group of people promoting open discussion on the key topics of the day.
Robbers tie up victims
(CNS): Updated – Police have now confirmed earlier reports on CNS that two men were tied up by armed suspects in the early hours of this morning during a robbery at the Ramada Grand Caymanian on the North Sound. At about 1.30 am Monday two members of staff were inside an office at the Ramada Grand Caymanian, when they were suddenly confronted by two masked men armed with what appeared to be handguns. The robbers tied the men up and left them locked in the office before the suspects entered another office which contained the safe. The victims remained tied up for around two hours before one of the men eventually managed to free himself and raise the alarm.
It was then that they discovered that the robbers had forced open the safe and fled the scene with a sum of cash. Neither of the men at the resort were injured during their ordeal and no shots were fired by the robbers. The first suspect is described as having a dark complexion, 5’6” in height and weighing 200 – 200lbs. He was wearing a black t-shirt, dark blue faded jeans and black and white sneakers. He had a black ski mask covering his face.
The second robber had a slim build and was about 6’ in height. He was wearing a long sleeved hoodie with camouflage pants and white sneakers.
Detective Sergeant Richard Scott who is leading the investigation asked anyone with information to come forward.
“This was a terrifying ordeal for the two men involved – luckily they weren’t injured. Initial indications
are that this was a pre-planned robbery,” the detective said. “It could be that the two suspects had been watching the movements of staff for a few days prior to the actual incident. That’s why I’d be keen to talk to people who saw anything suspicious in the days and nights leading up to the incident, as well as anyone who may have been in the area around the relevant time this morning. The information you have may be vital to the enquiry and I’d ask you to get in touch with us as quickly as possible.”
DS Scott said information can be passed to the Criminal Investigation Department at George Town police
station on 949-4222 or the confidential Crime Stoppers number 800-8477 (TIPS).
This is now the second tourist location to be targeted by robbers following the recent robbery in the heart of Seven Mile Beach at the Grand Cayman Beach Suites last month.
Tax and fees on LA agenda
(CNS): The issue of taxes and fees and their potential reductions will be at the centre of parliamentary business this week when the country’s law makers return to the Legislative Assembly. Government will be bringing a bill to amend the tax concessions law to enlarge the scope of those exempt from taxes to include any entity that government feels is in the national interest. The opposition is also bringing a private member’s motion requesting the reduction in work permit fees and the independent member a motion to require developers who receive duty waivers to purchase the goods through local merchants in order to get those concessions to help boost the local economy. (Photo by Dennie Warren Jr)
The Legislative Assembly resumes on Wednesday, when the government will be seeking support for the tax concessions amendment bill, which will enable the Cabinet to offer duty and fee waivers whenever government considers it to be of benefit to the country. The law will give the Cabinet the power to offer developments such as the proposed medical city, the cruise dock or the commercial port any tax exemptions they see fit.
Meanwhile, on the opposition benches Alden McLaughlin will be presenting a private members motion, seconded by Ezzard Miller, asking government to reduce the work permit fee increases. The third elected member for George Town says in his motion that statistics show a marked decline in the number of work permit holders in the Cayman Islands since the increases were imposed, and with many businesses under financial pressure, just as government has recently reduced the key employee fees, it should now consider reducing the fees for all work-permits.
The North Side representative will also be presenting his own private members motion, supported by East End opposition member, Arden McLean, asking government to require those developers who have been granted a reduction or special waiver of duties to buy the goods they need from local sellers instead of directly importing the goods themselves to ensure the money passes through the local economy.
As well as various other amendments and private members motions, there are some fourteen parliamentary questions tabled by the independent and opposition members to be asked of the premier and Cabinet members, from the current situation with the cruise berthing development and the current status of derelict tourism properties to questions regarding the proposed East End Sea port and the controversial government loan.
Lawyers move first unit trust from Cayman to Ireland
(Fundstrategy): Dillon Eustace has announced what it claims to be the first ever unit trust relocation from the Cayman Islands to Ireland. The Irish law firm says the move was completed on behalf of a major international financial institution and its underlying investor. The re-domiciling has involved a Cayman Islands registered unit trust successfully relocating as an Irish Qualifying Investor Fund. Dillon Eustace expects more fund relocations shortly. It follows the Irish Central Bank’s agreement to facilitate the general relocation of unit trusts. Legislation was recently commenced to streamline the process of re-domiciling of corporate funds to Ireland.
Haiti cholera deaths above 330 as Tomas approaches
(CNN): The death toll from a cholera outbreak in Haiti has risen to more than 330, and officials believe Hurricane Tomas may worsen the situation as it approaches. The number of confirmed cholera cases has climbed to 4,764, with 337 deaths, said Imogen Wall, spokeswoman for the UN Office for the Coordination of Humanitarian Affairs in Haiti, citing information provided by the Haitian government. Those numbers represent the people that were able to make it to the hospital, she said. Another 200 cases are suspected in the nation’s West Department, or province, she said. Tracking maps show Hurricane Tomas nearing Haiti on Thursday as a Category 3 hurricane.
Alcohol ‘more harmful than heroin’ says UK Professor
(BBC): Alcohol is more harmful than heroin or crack, according to a study published in medical journal the Lancet. The report is co-authored by Professor David Nutt, the former UK chief drugs adviser who was sacked by the government in October 2009. It ranks 20 drugs on 16 measures of harm to users and to wider society. Tobacco and cocaine are judged to be equally harmful, while ecstasy and LSD are among the least damaging. Members of the group scored each drug for harms including mental and physical damage, addiction, crime and costs to the economy and communities. The modelling exercise concluded that heroin, crack and methylamphetamine were the most harmful drugs to individuals, but alcohol, heroin and crack cocaine were the most harmful to others.