Cayman Islands lawmakers approved a bill that will make property transfers in all areas of the territory subject to a uniform stamp duty rate of 7.5 per cent, with exemptions for first-time Caymanian buyers.
At the moment, a 7.5 per cent stamp duty rate applies to property in premium areas of Grand Cayman, such as downtown or along the Seven Mile Beach corridor. Non-Caymanians pay 6 per cent for property in other areas of the Islands, while Caymanians pay 4 per cent.
Under existing law, first-time Caymanian buyers pay no duty when purchasing land valued up to $50,000 or homes up to $200,000. First-time Caymanian buyers pay 2 per cent duty on land from $50,000 to $75,000 or homes from $200,000 to $300,000.
According to the bill passed by lawmakers during the Legislative Assembly session Monday, 26 November, stamp duty will be 7.5 per cent on transfers throughout the Cayman Islands regardless of immigration status.
While stamp duty rates are going up overall, exemptions have been broadened for first-time Caymanian buyers, who will pay no duty for land up to $100,000 or homes up to $300,000, and will pay 2 per cent duty on land from $100,000 to $150,000 or homes from $300,000 to $400,000.
Stamp duty rates on property transfers have been adjusted several times in recent years, according to the Lands and Survey Department website. In 1973, the 7.5 per cent rate was applied on all properties. In 1995, the rate was increased to 10 per cent for properties valued at $250,000 or more.
In 1997, that was adjusted so that a 9 per cent rate applied to properties in prime areas, and 7.5 per cent was applied elsewhere. In 2001, the rate was cut to 5 per cent everywhere.
In 2006, the rates were changed to 7.5 per cent in prime areas, 6 per cent for non-Caymanians and 4 per cent for Caymanians.
In April 2009, the rates were changed to 5 per cent in prime areas and for non-Caymanians, and 3 per cent for Caymanians.
In October 2009, the rates were changed back to 2006 standards. The most recent change effectively reverts the law back to where it was from 1973 to 1995, except for first-time Caymanian buyers.