Business

(CNS Business): Premier McKeeva Bush has announced that he will be taking another trip to Washington next month to talk to American officials about the Foreign Account Tax Compliance Act (FATCA), which is generating uncertainty and concern here in Cayman. The premier said that as a result of previous visits the IRS had “heard the voice of the islands” and government was fully prepared to engage the US in another round of discussions. Although it is not clear how much impact Cayman’s lobbying has had, the premier says points raised in previous visits “seem to have been taken into careful consideration.” However, all that Bush appears to be hoping for during his next visit is a level playing field. (Photo by Dennie Warren Jr) Read more on CNS Business

(CNS Business): US law bars people who relinquished their US citizenship for tax purposes from entering the country or obtaining a visa. They are also subject to an exit tax on everything they own as if they had sold it all, tax experts said at a seminar yesterday on US immigration and expatriation tax rules. Tax would even have to be paid on property owned outside the US, although the first US$600,000 of gain was exempt. If an individual has filed their tax returns for seven years they can proceed with relinquishing their US citizenship, but the process involves lengthy form filling, an interview at the US embassy, reflection time for the individual to seriously consider the implications of their actions and then a decision process by the US authorities. Read more on CNS Business

(CNS Business): People who live in the Cayman Islands who are US citizens, green card holders or even just have spent more than 183 days in any calendar year in the United States, are all required to file tax returns in the US, as they may be liable to pay tax there. According to US tax expert Shawn P Wolf, filing tax returns did not automatically make the individual liable to actually pay tax as certain exemptions or exclusions applied, particularly for those people who truly lived and worked outside the US. However, speaking at a seminar aimed at helping such individuals get started with filing their US tax returns, he warned that the only way to apply for such exemption was to file a return in the first place. Read more on CNS Business

(CNS Business): Education Minister Rolston Anglin has called for “social change” when it comes to accepting the legitimacy and gainful-employment possibilities of a variety of trades. The Cayman Islands Further Education Centre – the new government Year 12 programme – now offers vocational courses but, the minister said, the community still needs to undergo an attitude change toward learning trade skills.  “What are we going to do differently to get parental buy-in?” Anglin asked. “Through parents encouraging their young people and seeing these qualifications as worthwhile, that is crucially important.” The ministry's push to promote the value of learning a trade is being reinforced by the economic slowdown, which Anglin said may be one of the greatest motivators to shifting attitudes toward seeking jobs in the trades. Read more on CNS Business

(CNS Business): With the Cayman Islands Further Education Centre into its second year, Minister of Education Rolston Anglin has this message for those in the community who continue to call for the establishment of a trade school: the ministry is “well on the way” to providing vocational training and CIFEC is only going to get better. Others in the ministry are equally enthusiastic about the prospects for expanding vocational courses in Cayman and what that means for employment prospects for young Caymanians entering the workforce. The key is for the vocational education system to train students in areas with employment possibilities by consulting with local industry to target the appropriate sectors. Read more on CNS Business

(CNS Business): A group of UK members of parliament has proposed an Early Day Motion in the House of Commons in an effort to close down tax havens, including the Cayman Islands. Led by the Labour member for Leyton and Wanstead and former Treasury Select Committee member, John Cryer, the motion calls on the UK government to introduce urgent legislation to help close tax havens and increase transparency “so that the very richest pay their fair share of tax”. In the wake of revelations about US presidential hopeful Mitt Romney's finances, Cryer and his Commons colleagues say they are alarmed by his use of the Cayman Islands, a UK territory, to avoid paying tax. Read more on CNS Business

(CNS Business): Responding to a report on a major US television network news station on the use of offshore accounts in the Cayman Islands by Mitt Romney and the corporation he once ran, Cayman Finance said it displayed a total misunderstanding of the role of the Cayman Islands’ tax neutral framework. The Cayman government has also issued a statement calling allegations in the report of improper secrecy in its dealings as an offshore jurisdiction "unfounded". The report on ABC News, which referred to the Cayman Islands as “a notorious Caribbean tax haven, where secrecy is the rule”, said the Republican front-runner for nomination to run for president used “tax loopholes available only to the super rich”, which resulted in a 15% tax rate, much lower than most Americans. Read more on CNS Business

(CNS Business): The news team of one of the major US network television stations has focused on presidential hopeful Mitt Romney’s offshore accounts in the Cayman Islands, which they say has enabled him to pay a low 15% on his earnings. The front runner for the Republican candidacy, Romney’s personal wealth, estimated at around $250 million, has come under increasing scrutiny as his GOP rivals, looking for attack material to lessen his lead in the nomination race, have made this a campaign issue. Homing in on this new point of contention between the candidates, ABC News has run a feature on Romney’s low taxes, sending a TV crew to Cayman, which they call “a notorious Caribbean tax haven”. Read more on CNS Business

(CNS Business): A key difference between the most recent offshore voluntary disclosure programme announced by the US Internal Revenue Service and previous programmes is that it will run indefinitely, according to David Conen of KPMG (Cayman Islands). Confirming that he has had clients who have made use of the previous programmes, Conen told CNS Business that the latest programme will lead into the implementation of the Foreign Account Tax Compliance Act (FATCA) in two years’ time, when the US will be requiring considerably more reporting and compliance for offshore accounts. He said people were realising now that they should be on the right side of the US authorities, especially while reduced penalties are in place under the current voluntary disclosure programme. Read more on CNS Business

(CNS Business): In an attempt to gauge the public’s view on governance, transparency and politics in general, CNS Business has partnered with the organisers of this week’s Cayman Business Outlook conference and offers readers the chance to have their say anonymously on the subject in a specially devised poll. Results from the poll will then be put to a panel of local speakers at the conference, which will be held this Thursday at the Westin Casuarina Resort & Spa. Readers who would like to submit questions to the panel can do so anonymously as comments on CNS Business.

(CNS Business): The Financial Services Legislative Committee is currently working on a number of amendments to existing legislation and new bills that will boost the industry, the chair of the committee has revealed. Charles Jennings, who is chair of the specially created committee, said several major legislative projects were underway that would put the Cayman Islands back at the forefront of the offshore financial sector. He said revisions to the Companies and Exempted Limited Partnership laws and several brand new laws to establish vehicles such as portfolio insurance companies, limited liability partnerships, limited liability companies, foundations and others are all in the works. Read more on CNS Business

(CNS Business): Following the collection of billions of dollars from around the world by the US Internal Revenue Service from its Offshore Voluntary Disclosure Program (OVDP), representatives from the Cayman Islands financial services sector say it is unlikely that any of that cash has come from this jurisdiction. Anthony Travers, the former Cayman Finance chair who has stated on numerous occasions that tax dodgers don’t use this jurisdiction, said it was wrong for anyone to assume the money would have come from accounts based here. Richard Coles, the current chair of the industry body, said there was nothing to suggest any of the money came from Cayman but if it had they were pleased it had been recovered. Read more on CNS Business

(CNS Business): Despite the popularity of the OffshoreAlert annual conference among Cayman’s financial industry experts, the industry’s Cayman Islands association has again failed to respond to invitations to take part or contribute to the agenda. The publisher of the financial watchdog’s website and monthly newsletter which shines a light on the darker side of the industry said he was disappointed that although he had reached out to the organisation, he has received no reply. One of the members of Cayman’s judiciary, however, has agreed to take part and will be joining a panel of regional judicial heavyweights to discuss key rulings and legal issues affecting financial services. Read more on CNS Business

(CNS Business): Half poured concrete columns, rusting rebar and the slow reclamation of building sites by indigenous flora are a constant reminder of how the Caribbean has been impacted by world events over the past three or so years, according to a gloomy assessment by BCQS International, a property and development consultancy in the Caribbean and Latin America. Of the jurisdictions assessed, Turks and Caicos has the highest construction costs with Barbados and the Cayman Islands not far behind, BCQS found but predicts an overall decrease in costs up to 2015 as the market adjusts itself.  Read more on CNS Business

(CNS Business): The developers of Morritt’s Tortuga Club and Morritt’s Grand Resort have announced a major expansion of the East End timeshare and resort with an anticipated investment of some CI $58 million over the next 5 to 10 years, with construction starting on the first phase no later than June of this year. Morritt Properties said in a release yesterday that the two existing resorts have consistent levels of high occupancy, often over 80% year round, and over 12,000 owners worldwide. With the new developments, the goal is to double their timeshare ownership in the next 10 years to 30,000+ club members. Read more on CNS Business