A whopping 20 per cent increase in government revenues from one year to the next is largely made up of what the Cayman Islands public sector refers to as “coercive revenues”.
Within central government, Cayman expected to receive nearly $591 million in coercive revenues for the current 2012/13 budget plan, compared to about $484 million collected, according to unaudited actual figures, in the 2011/12 budget.
Coercive revenues do not encompass all revenues government collects, but they do represent the vast majority of the funds central government spends each year.
According to the 2012/13 Annual Plan and Estimates budget document, the largest increases in government revenues occurred in the following areas:
An $8.4 million increase in collections for banks and trust licences; going from $23.7 million in 2011/12 to $32.1 million in 2012/13;
New fees collected mainly from financial services companies for the 2012/13 budget year, including: $1.2 million in company management fees for company managers; $10 million in company management fees for fund directors; $3.95 million in company management fees for trust services; $18.2 million in compliance fees for “all other directors”; $1.6 million in compliance fees for directors of regulated entities; and about $1.5 million in compliance fees for directors under the Securities Investment Business Law;
Work permit fees are set to bring in some $9.4 million more in revenues than they did in the last budget year. The Cayman Islands raised about $48 million in revenues (unaudited figure) from work permits in the 2011/12 year, compared to an anticipated $57.4 million in the current 2012/13 fiscal year;
Some $3.125 million is expected to be gained from an increase in the Islands departure tax;
An additional $2.5 million is to be collected from Health Insurance Fund fees;
Approximately $1.8 million will be collected in “master fund registration fees”. These were not collected, according to budget documents, during the 2011/12 or 2010/11 fiscal years;
“Motor vehicle charges” will raise an additional $4.7 million, according to budget documents, bringing in a total of $13.2 million for the 2012/13 year. In 2011/12, that figure was $8.5 million; in 2010/11 it was just $1.26 million;
“Other” company fees for exempt companies are expected to bring in an extra $7 million during the year, going from a total collection of $55.7 million in the last budget year to $62.7 million in the current year;
Import duty collections are expected to bring in $11.5 million more than they did in the last budget;
Similarly, partnership fees are anticipated to bring in an additional $13 million, going from a budgeted $10.4 million in collections during 2011/12 to $23.4 million in 2012/13;
Planning fees will bring in about $1.1 more than they did last year, more than doubling what government collected according to budget documents;
An increase in stamp duty for most land transfers (purchases) in Cayman is expected to bring in an additional $3.5 million in the current budget year, when compared to last year;
Duty on tobacco imports will raise an extra $1.15 million;
Rising tourist accommodation charges are expected to raise about $2.5 million more than they did during the 2011/12 budget.
Related Videos
Why is it that the government has yet to realise that increasing fees does not equate to increased revenue? The method they have chosen will lead to less spending and a dip in revenue not an increase. It is simple economics the supply of funds to the average working man is low therefore they are compelled to save more and spend less.
Our finance industry is under attack. Governments tax those things that they want less of. Our government obviously wants less finance industry. Nevis is looking better all the time.
Taxing a country into prosperity, is like standing in a bucket and trying to lift oneself up by the handle.
-Winston Churchill. Great man.
I wish I could buy a crystal ball the government uses to read the future.
I am staggered with disbelief and disgust at the huge incompetence of our Government in managing the finances of our country, so much so that I have thought about giving up commenting.
But for those who hope I may fall silent, I shall disappoint you, never fear!
Work permit fees are set to bring in some 9.4 million more in revenues…. Work Permit fees? Where does the government get the money for that? According to the Compass on 17 August, 2012, Cayman Islands government is by far the largest employer of non-Caymanians…. Overall, 1,533 non-Caymanians were employed in the public sector…!! Counting money they already…. sounds like a plan!
Good government accumulates resources during boom and helps business bad years. Bad government gets in debt during boom and pulls business down during bad years. Don’t need finance education to understand that.
All the damage to economy about to be caused by Payroll tax is still here, in this numbers. Rearranged a little, but as deadly for the economy. Assumptions that business will just pay more don’t usually work, so most likely budget revenue projections will not be met by end of the year. Which will bring question up again – Payroll tax or 1,000 public servants? (this time it was 900, next time it is going to be more).