PPM: Expat only tax too divisive

Posted By Priscilla Eden
Thursday, 26 July 2012 8:09 pm

Government wants to impose a 10% payroll fee on work permit holders. The opposition says once the tax line is crossed, there is no turning back.

“It shouldn’t have come to this, Opposition Leader, Honourable Alden McLaughlin, said.

He says he’s concerned what an expats-only tax will do to the Cayman Islands.

“They have now crossed that threshold wants they put into law. I am shocked they are putting in this kind of taxation,” Mr. McLaughlin said.

He says government’s proposed community enhancement fee, a 10% payroll tax for work permit holders only, is too divisive.

“It’s polarising the community already and it’s dangerous.”

The People’s Progressive Party leader also says it’s only a matter of time before Caymanians are impacted directly.

“We know that at some point this will be expanded. Anyone who thinks we escape is terribly mistaken,” he said.

Mr. McLaughlin also says he finds it hard to believe government wants to make the new tax effective next month.

“They’re going to have to create a new tax structure, a new tax authority, a new bureaucracy,” Mr. McLaughlin said.

Government says it was the previous administration’s fault as to why the UK has control over the national budget as it exceeded borrowing ratios. Mr. McLaughlin admits that may have been the case, but 3-years later, he says the UDP administration has no one to blame but itself.

Cayman 27′s Tammi Sulliman reports.

  • T6

    It is interesting that Alden McLaughlin admits that whilst the PPM was in power (2005-2009), they spent like there was no tomorrow. He takes it like a trivial matter and believe that it has nothing to do today. He eloquently cuts his responsibility off and says its all the UDP fault. I don’t think so. I believe if PPM didn’t caused us to go into an economic downturn in 2009, the UK would not have had to come to the UDP with a deadline plan in 2010 and restricted this government from borrowing. Certainly, he is going to dress himself up like Kurt and his party had little do with where we are now. PPM left us with a deficit that to this day we don’t know what the figure is, because there was no auditing done! They left us with unfinished schools that cost the UDP a fortune to finish. If you ever take a drive through Frank Sound and see that school, it looks like a city! So Alden, UDP may have contributed big time to where we are now, but accountability didn’t stop with him. How can you go on air and downplay your role which left the country in financial uncertainty and the UK’s mistrust for any Caymanian government that comes to power??? Note: Now we have a Premier, mandated by the UK’s FCO to enforce a “sustained revenue measure” on these islands. Every budget he presented they refused. They wanted reduction of expenditures and an enhanced sustained revenue in the budget. And everyone knows what that means. As to the form of sustained revenue he has chosen, i.e., an expat payroll tax, let me say this to the viewers who are Caymanians and complaining. If you follow Alden and also Ezzard, you will end up having then a Property, Income, or Vat tax. There is no other alternative Cayman – It is either you have a Direct Tax or the Governor and FCO Minister has indicated they will not accept the budget from the Premier. So his hands are tied.

  • Anonymous

    Well its nice to see Alden finally admits PPM borrowed too much and on Rooster 101 this morning and said and I quote he “spent out of style.” What took him so long to get that out in the public? The Foreign and Commonwealth Office (FCO) works with M15 a spy agency. I would advise people to study what is going on in Turk and Caicos Islands concerning the VAT tax, because they have enforced it on the people there, and seeing that they are using our Premier to enforce a sustainable revenue, it could very well be they may want us to have this VAT tax. One thing is for certain, a few people in the FCO is calling the shots for a 55,000 populated island, as if they are economic experts. We can only pray.

    • REi

      A lot of people here think that the UK is an enemy of Cayman and out to destroy it. Yes, there might be a little competition with London but you have to remember that the UK created one of it’s biggest competitors – Hong Kong which is much more of a threat to London than the Caymans ever were, and the people there are very reminiscent about the UK era in Hong Kong!

      If Cayman Islanders want to stop the FCO dictating their affairs, they should ask their Premier to campaign for integration into the UK as a country with some autonomy (in tax and immigration). That would give the Caymans equal status in one of the most influential countries in the world and a seat in UK parliament.

  • Younia

    Dear Mr.Bush,
    We the people of your birth place the Cayman Islands, would like to give you a round of applause for this action taken however even though this is a start we would encourage you to please take into consideration the amount of unemployed Caymanians that are in Cayman today by you announcing this action maybe there will be more Caymanian faces in the working environment instead of seeing someone whom you don’t know and doing a job that a Caymanian female/male could be employed and doing.
    Although 10% is a start we would like you to turn it up a notch to about 55% this amount will ensure more jobs for the Caymanians out there who want to work but cannot get work because a foreigner is choosen over a Caymanian who would work twice as hard because they want to prove to who have this saying that goes ” Caymanian children are lazy they believe in this intitlement” although some may have that way of thinking others don’t so don’t label us all as one because not all of us are lazy some of us came up very hard and want better in life … every human being is not the same; and altough you foreigners may not agree with what I have to say it’s simply too bad; because if it was your homeland and others could come to your country and take up all the jobs,land and other beneficial things that are offered and when it comes down to you and yours … you and yours are always lefted behind then labeled as lazy. I’m pretty sure ya’ll would feel a way about it and eventually become fed up with the way foreigners are being put before you in you’re own country;and it’s not fair for us who are decent Caymanians with a proper outlook on life and have goals we want to reach but cannot reach them do to finanicial issues which is caused because lack of employment.

    Mr.Bush excellent start please don’t stop here continue to increase the tax on permits this will be a good outcome for your people this is what makes the Caymanians sigh in relief this helps takes nots out of Caymanians foreheads wondering when there will be change.
    Continue to make more beneficial changes for the Caymanians.

    • Yolanda

      I feel bad for the intelligent Caymanians who realize that the foreign work force runs their country and have to put up with the others who are lazy and overly opinionated. Good luck trying to keep things stabilized when all the expatriates move off island. This country is a joke. Lose the sense of entitlement and realize that cooperation and unity is the only answer. How corrupt can you get? Keep trying to buy votes Bush.

  • Dec

    Why not listen to the people and send all the Ex-pats home, refuse employment visa’s and request that all Ky’s return back home. There will then be more than enough employment, homes and choice of Ky partners.

    This my friends (above) will not help the country, its time you all grew up and realise the truth, its not the Ex-Pats distroying your country, they dont just jump off a plane and take employment from the people and their have little to no rights. As for the illiterate bloggers, no wonder your in the state you are vwith that old hatefull thinking and scaremongering.

    Once one set of the work force is taxed it will reach the others too, as those who realise that they are not being paid what they are worth, will start to look elsewhere, the government will therefore have to also look elsewhere for income. Which means, eventually all in the workforce will be taxed, look at other countries Tax is on almost everything and it never goes down.

  • c wilson

    Cayman has a debt to GDP ratio of about 25%…. relatively low considering Japan is near 200% and the US is 105%. Moody’s gives Cayman a Aa3 rating (investment grade), so why cant they sell sovereign bonds or sell savings bonds to residence??? Canada has Canadian savings bonds backed 100% by the government. It is a super easy product to sell and teaches young people (and old) to save and can be bought with deductions from payroll. We are basically lending the government money and getting paid for it.. win/win!! instead of them taking it… lose/lose

  • James Hynes

    All of the comments have some validity, both pro and con, but one thing that has been overlooked is the 10% tax increases the cost of doing business in Cayman. The employers will have to collect the tax, account for it to government, and the non-Caymanian employees will take home 10% less in pay. That will cause some to leave the Island, some to demand higher wages or work less, and the business will be hurt, prices will go up, service will go down, and the overall economy will be negatively effected. And if the business community will be negatively effected, they won’t be firing replacements, Caymanian or Ex Pat. Welcome to the next recession.

  • @ Yolanda

    LOL

  • Caymanian

    James, expats are replaceble! So if they want to leave, let them. More will just come and replace them. Simple as that. It happened before after Hurrican Ivan when all the expats fleed for their lives, and then we got new faces.

    • linda

      oh gosh it had to be a bad minded caymanian that come out with a comment like that, you know what im british and just cos our pound is bigger than the us and yours dosent mean i think i am it like you caymanians, god get a grip

  • Caymanian

    linda, it is being factual. You pick up and go because of a tax, other fill your vacancy. What isn’t in this simple fact do you not understand. Cayman doesn’t circle you. You get a grip

  • Two pints of Caybrew Please

    Hmmm…two points..Cayman has a large expat community mainly because so many Caymanians don’t have the skill, will or inclination to do the jobs or get educated to do them. Plenty of chips on shoulders about expats but no actual will to do anything about it…just sit back and moan, much easier isn’t it? Secondly…why not pay income tax? The rest of the world does. Why should Cayman get away with import duty, taxing tourists and leaching of the UK? Pay your way Cayman and maybe you’ll see some improvements….or at least when you start paying for your government and services you might start taking an interest in how your money gets spent.

    And the fantastic comment “expats are replaceble! So if they want to leave, let them. More will just come and replace them. Simple as that.” Says it all…yep replace them…don’t think about getting Caymanians educated to do the job. Typical.

  • Caymanian

    You said, “more will come and replace them.” I think you are use to saying that when you lay off Caymanians. It is jealousy that we are not in a country that pays income tax like your country. Just be honest with us – Are you running away from the IRS? I would like to know because I understand you are having a tax-dodgers protest and expecting those very Caymanians you lay off to join you. Typical

    • two pints of caybrew Please

      when you can construct a sentence that makes sense in the 21st century let me know…until then..booknook…dictionary…go for it.

  • Jordanian

    Dear caymanian …..don’t till people to leave cayman you need to have some behave this country wilcome evry one and who you are to till people to leave i think you should be man and say your name if not your not real man I write my name all the time and when I talk in radio I say my name
    Be man and be nice as expat I’m sure nice to you.
    Amjed the Jordanian embassdor

  • Two pints of Caybrew Please

    Caymanian…not sure of your point..please expand.

  • Caymanian (real one)

    First of all I don’t why he or she is using “Caymanian” because I consider myself a real Caymanian, and everybody is welcome to my table. This is the attitude we had for a long time. We treated our banking clients with fairness and dignity. We never taxed them for banking with us, and we became properous. It was until we had two parties that we began to spend and borrow like crazy.

  • Davoid

    Nothing has happened yet!! The UK is just reprimanding a spoiled out of control child. Requirement that only university educated people can serve as MLA would help a lot. You know, ability to read write, add, subtract and actually think. Not SCHEME, THINK!! If you get a income tax, believe me for it is a national sport here, folks will find a way around it. Just think of all the new government jobs that will become available. Cayman will have it’s own I R S . What a comforting thought. If CAL and all it’s facilities were sold it would save a ton of money. You can not expect Government to run anything efficiently because there is no motive to do that. No profit motive, and profit is not necessarily a dirty word. I am sure there are many other things that the private sector could do better than Govt. and a lot cheaper too. Of course that means Govt. would loose some of it’s heavy handed power, so it will probably never happen. If I was a Caymanian, my head would be hung in shame for having the UK have to take me to the wood shed because of what my elected officials have done.

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