Richard Murphy agrees with the premier’s tax
Richard Murphy on his Tax Research UK website heralds the Cayman Islands Premier McKeeva Bush’s announcement of implementing a ‘Community Enhancement Fee’. With a bold headline saying, “Tax is the answer – even in the Cayman Islands” he quotes from another Cayman media house that calls the “fee” a payroll tax.
Mr. Murphy starts off admitting to “quiet amusement” at the news. It’s so nice when our Islands can amuse people in these not so happy times.
The rest of his article says:
“Let’s just unpack that for a moment. First, this is an income tax. Cayman has never had one before.
Second in true tax haven style the tax is discriminatory: only expats pay.
Third, for once discrimination may have a point: Cayman has sold out its entire economy to expats so there is a logic in charging them.
“Fourth, the reason for this tax is that its business modelling is failing. Surprisingly to some, a no income tax economy can’t balance its books. The Republican Party in the US should take note. Some in it think the US could do without income tax.
“Fifth, the real decision maker on all this is the UK. The charade that Cayman is independent is shot through by that admission. The buck stops in London. Which is why the buck for the tax abuse in Cayman also stops in London. Oh, and why Jersey et al are also subject to the same rules, whatever they like to say. Like the local councils they are, all they do is ultimately subject to central control from London.
Finally, the situation is desperate. These places never admit crisis until it hits them. The same will be true in the Crown Dependencies.”
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