Today’s Editorial August 28: Prepare for taxes

It’s come to this.

The Cayman Islands is so deep in an economic hole, it can’t meet its financial obligations.

Over the term of the People’s Progressive Movement administration, the government grew too large and incurred too much debt to be able to withstand a major downturn in the economy.

Now, the UK has Cayman over a barrel, refusing to let it borrow any more money until it can produce a sustainable revenue plan. It wants Cayman to implement direct taxation.

The fact that the UK can borrow its way out of its own economic crisis is immaterial. Like it or not, Cayman is an overseas territory of the UK and it has to do what Mother says.

Just like a teenager with a credit card who spends more than he earns, the parent who co-signs for the card is the one in control

Although Mother isn’t saying Cayman must implement direct taxation, she is certainly suggesting it. And we all know that when mothers suggest things, they’re really telling us in a nice way what we should do.

Income tax could be disastrous here, and it would probably affect lower earning workers the most. Highly skilled foreign workers are likely to be compensated for an income tax with higher salaries, leaving the lower wage earners to feel the real pain.

Property tax is another of Mother’s suggestions, but it could cripple the real estate industry here.

Neither form of taxation is very appealing; nor are some of the suggestions by the civil service – many of which would raise the already high cost of living.

Make no mistake about it; there’s a bitter pill coming our way.

There’s an old saying that nothing is certain except death and taxes. Until now that adage really hasn’t applied to the Cayman Islands, but it looks like death may have some company in an uncertain future.

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