Bush attacks rush on tax law

(CNS): Leader of the Opposition McKeeva Bush has accused the government of rushing changes to the Tax Information Exchange Authority (TIEA) Law without properly briefing opposition members or engaging in a wider consultation with the financial services industry. Referring to the amendments which were passed in the Legislative Assembly last week, Bush said there had not been enough debate on what was a very important issue.

He said there was an apparent attempt to minimise the level of consultation with the wider industry or the opposition. The bill was first brought to the House on Monday, 15 December, leaving members with just two days before it was presented to the floor on Wednesday. It had its third reading by Friday, 19 December.

"The Tax Information Exchange Authority Law is one of the most important pieces of legislation in this country in this day and age where international cooperation and tax information exchange are paramount to the way that our financial industry operates,” Bush said. “Why has this been done in such a secretive manner? I was away for two days for medical reasons and when I returned I found out that the bill went through the house via committee with changes apparently passing without debate.”

The changes to the legislation will allow the Cayman government to enter into agreements with other countries to share information about financial dealings here that may relate to tax issues in other jurisdictions. There are issues of debate about how much Cayman should be telling other countries about business dealings here versus the need to have more TIEA to both reduce the criticism by OECD countries and maintain the regulatory credibility of the jurisdiction. By and large the need for more TIEA is generally agreed by most people but there has been little information given about the amendments to the bill and how far the law now goes.

Bush said his main concern was that the whole exercise was handled in such a way that some people in the financial services industry were not even aware of the proposed changes.

"Whatever happened to the days when the government consulted with the wider industry on major issues such as this?” Bush asked. “Are we to accept that whoever this small clique of special persons are that are involved in these discussions, know all that is best for this country? Why are we keeping the majority of the financial services sector in the dark on such a potentially major issue?"

Bush said that at the very least there should have been a special briefing with himself as Leader of the Opposition and some form of wider communication to the broader industry that something was being worked on. "We are all supposed to be on the same side when it comes to protecting the Cayman Islands economy. Why can’t we put political differences aside on a major issue such as this and bring everyone into the picture on what the plans are? I expected at the very least that the plan and strategy would have been explained to me," added Bush.

The opposition leader said that during the PPM’s term in government the approach to consultation on issues relating to the financial services has been handled through small groups of industry representatives being consulted on major changes, as opposed to the previous approach where a larger Private Sector Consultative Committee (PSCC) was frequently briefed on the industry’s issues.  

The irony of the change is not lost on critics because they were elected primarily on the basis of their promise of greater transparency and being a so styled "sunshine government", he noted.
 
"If the changes are to address the international challenges that we face, then fine,” Bush declared. “But we need a more open government on this. Whatever the approach and strategy, we certainly should not be hiding the changes from the major stakeholders within the financial services sector and the opposition. In the same way that they were trying to hide the draft constitution from the people, they are hiding changes to key pieces of legislation to suit their own agenda.”