Direct Taxation?

Posted: Sun Sep 06, 2009 8:23 am Post subject: Direct Taxation?

Cayman Islands is faced with an inability to pay for it's government including servicing it's creditors.

The British government refused Cayman Island's request to borrow more instead suggesting "direct taxation" to solve the current shortfall and pay for government's future expenditures.

Several methods of direct taxation are being discussed in Cayman goverment offices including property taxes, payroll taxes, income taxes, and value added taxes.

The current Cayman Island administration has indicated it prefers not to introduce property taxes or income taxes. Instead they propose to raise Import duties and other fees or "indirect taxes".

It goes without saying, belt tightening by the current goverment must be a part of the solution. It is suggested that government start with a "zero based budget" which scrutinizes all departments and their expentiditures with only "essential" items being those that are included in the new budget.

Cost reductions in goverment cannot be the only steps taken. Cayman islands can't "save" itself into prosperity.

While Cayman Islands is not alone in this problem given the current world wide recession I ask the readers of this post to suggest some ways Cayman Islands can come up with a sustainable money generating system which is fair to all residents and visitors and significantly pays for the cost of necessary goverment.

All the best Cayman Islands...

Newbie Joined: 22 Jul 2009 Posts: 2

They could start by selling their airline! Cayman Air has been losing money for as long as we have been visiting, about 8 years. Anything that doesn't increase costs for tourists!!! Everything there is already too expensive.

Posted: Sun Sep 06, 2009 10:22 am Post subject:

Cayman Airways is "self serving" to the Cayman economy. It brings tourist dollars to the islands.

As long as the airline serves as a profit instrument and not a semi-private airline for goverment officials it's a good thing.

Eliminating the airline may be a two edged sword. It may incent other airlines to establish or increase flights to Cayman due to the decreased competition or incent the existing airlines to increase the airfare to Cayman for the same reason.

I don't use Cayman Airways since it does not fly out of Newark or Philly. They are generally more expensive than the other airlines.

Newbie Joined: 22 Jul 2009 Posts: 2

I don't use them anymore either, not since they CANCELED our flight a few years ago leaving us stranded, never gave any reason or notice, let alone a comp or something for all the problems it causes us and a lot of other people. Got to the airport and the counter was just closed. We ended up catching a delta flight 4-5 hours later. Never did find out what happened, and never did fly with Cayman Air again either.

If they're self serving, then who is getting served? The government loses money on it, I've talked to lots of other tourists who don't fly with them anymore either. They charge really high rates, then still lose money. Not sure I can understand exactly who is getting served.

And here is something else I heard, but I don't have any way of proving it. That the Cayman goverment won't let any other airlines charge lower fares. Carriers like American have flights of roughly equal distances for up to half as much to most other places, but to Cayman, their prices are still right up there with Cayman Air, them and all the other airlines (at least within plus or minus a few percent). So I think there is something true to what I've heard, even though there's no way to prove it.

Anyway, then what about letting the resorts have casinos? Lots of other islands around there have them, like Aruba, Bahamas, I'm guessing maybe about half of them, so they must bring in tons of cash. Then the government could tax them or duty them or whatever they call it. Yea, casinos would probably be their best *bet* right now.

Newbie Joined: 30 Mar 2007 Posts: 1

Casinos sound like a great idea. clapping

Government gets the revenue they need and more tourists would probably go too, and more often, if they had casinos. Not everyone spends a lot of ash in casions but most people on vacations will drop at least a few coins in the slots, make a few table bets. It's harmless fun and a huge tourist attraction. Most people will only drop a $100 or so, but multiply all those little bets by millions of tourists and you are talking a fortune! Then add all of the people who live there...

CA-CHING! Razz

No need to raise taxes or duties, and bye bye to any money problems.

I don't know why no one thought of having casinos a long time ago. Besides the money from gambling, casinos employ a lot of people and generate a lot more income in other ways, like entertainment, alcohol and cigar sales, and lots of other income. And anyone that doesn't like casinos simply don't have to go inside, so no negative impacts, or nothing that would act as any kind of a deterrent like that dolphin park!

All just MHO of course but someone should send them a letter or whatever the process is to put the casino plan into action, right now while they are considering new ways of generating income.

Native Joined: 18 Feb 2005 Posts: 2034 Location: Illinois

Aren't the people in the island opposed to gambling? Do you think that might change the whole tone of the island?

Shelly :-)

Posted: Mon Sep 07, 2009 6:36 am Post subject:

Gambling is another idea worth considering for the long term. We have it in New Jersey but it kicks in very little to the goverment pot.

Cayman needs something it can implement now. The goverment can not even pay it's pension obligations.

Revenue generating suggestions that require a lot of overhead to operate won't meet the current need.

Posted: Mon Sep 07, 2009 6:43 am Post subject:

How about this...

Now that the Swiss have opened their books to the US on persons or entities seeking to hide money from goverment tax authorities why can't Cayman tighten their bank secrecy laws to attract this money. The secrecy would have a value that "people or entities" in that position would be willing to pay?

A depositor's fee woud be easy to administer.

Frequent Flyer Joined: 15 Feb 2005 Posts: 80

Cayman needs to bring in more affordable things for tourists to do. Larger kids programs, better tourist information world wide, more 18 hole golf courses ( tons of people rent winter homes in Florida for the golf ), promotion of the best Beach in the Caribbean and the list goes on. The idea of build it and they will come needs promotion which is lacking up here in Canada. A few all inclusives would help compete with Cuba and Jamaica directing some of their traffic to Cayman. The world is looking for a safe friendly place to go for a vacation that can cater to their needs and those of their kids. Cayman has all the right things but has missed putting it all together as a package that says I have to go there. Prices need to come down to compete and Cayman will be bigger and better than ever without missing a step. The polititions need to see that Cayman has priced itself too highly for the tourist trade dollar and needs to adjust just as the Real Estate industry adjusts its prices when things don't sell. If it's too high it dosen't sell. Living with blinders on only costs people jobs. I will now step off my soap box.