It’s time to use taxation in our favour.
Contrary to what many believe, philanthropy in developed nations is not always comprised of unselfish wealthy people sharing their wealth with less fortunate ones.
The fact is that they are given a choice to invest their money in tax deductible entities of their choice or pay it directly to the taxing government. In most cases they would rather pay philanthropically than to pay taxes to wasteful governments. In view of recent comments by Mr. Obama, this is an excellent opportunity for Cayman to benefit from similar activities.
A comprehensive (graduating) tax regime should be introduced whereby all multinational taxpayers (individuals or corporations) of other nations operating in Cayman, are given a choice to establish innovative philanthropic entities with a view to
• training, mentoring and promoting (all equally deserving) Caymanians in the workplace,
• preserving our heritage and cultural identity,
• financing parks, recreational centres, after-school programmes and the like,
• financing 100 per cent education and health care (medical, and dental) to all Caymanians,
• exhibiting a level of social consciousness as would be expected from good corporate citizenry.
Funds invested in the areas of their choice would then be directly tax deductible from income to an extent that could virtually mitigate the effect of paying any tax directly to the government.
Additional benefits would be that
1. G20 would leave us alone since we will have implemented a comprehensive and transparent local tax regime
2. We could then enter into tax treaties with G20 making taxes paid to us deductible from the world-wide income of our multinational tax payers
3. We could continue to offer legitimate high calibre offshore financial services
4. All Caymanians would once again walk in pride knowing and appreciating our value.
Wealthy individuals and corporations never acquiesce to ultimatums or futile expectations of fidelity. The only way to affect these people is along the lines of how their lucre will be affected by public policy.
George P. Samuels