Entering a new world

In case you haven’t noticed, governments almost everywhere in the world, including ours, have been spending taxpayers’ money like a bunch of drunken sailors, borrowing from the future in what has been termed “intergenerational theft”. Despite the accumulation of what is now, or is soon to be, unmanageable debt, many government leaders, as Obama has done in the United States, deny that they have a spending problem and are looking for new sources of revenue; read taxes.

Our government, part of the overspending club, has raised fees to levels which, if they have not yet, soon will exceed the ability of the private sector to pay them. In the quest for new sources of revenue, governments have found a convenient target; the so called “wealthy”, who must be made to pay their “fair share”. There is considerable debate about who is to be included among the “wealthy” and what is a “fair share” but that is not for discussion here.

The important point is that the wealthy have assets to be “shared” and that those assets are located not only in their home jurisdictions but also overseas in other countries, some of which have been labelled, as has our own, “offshore tax havens”; these wealthy must be hunted down. Never mind that it is not illegal for a US citizen to have an offshore bank account; indeed, if you are a US citizen who is an employee of a multinational corporation, for example, General Electric, and you are employed by a GE subsidiary overseas, you need to have an offshore bank account to conduct your daily activities. The only illegality is not to share the annual fruit with your government.

The double standard – In the desire to hunt down individuals with overseas accounts, governments are looking for “chump change” behind the cushions of a sofa. Large multinational corporations with overseas subsidiaries are allowed to retain and maintain profits offshore and they do because of the desire to escape the onerous taxes imposed by the jurisdiction of the parent. To use US multinational companies as an example, there are trillions of dollars parked overseas in the bank accounts of subsidiaries, which are not taxed. Better to hunt down individuals who are not able to defend themselves against the inexhaustible resources of the state.

What of Cayman? Cayman has no choice but to join the grand parade of jurisdictions that are and will continue to provide information on accounts held by overseas citizens. Despite all of the international studies, which show Cayman to be a transparent jurisdiction that is first in the world in due diligence, an account held in Cayman will continue somehow to be tainted; look what Obama did to Romney in this regard in the last election.

Nevertheless, we must all speak up and defend Cayman, as does, for example, Anthony Travers, and the right of individuals to move their assets overseas to Cayman as long as they give a percentage of the fruit every year to their home jurisdictions, something which wealthy corporations do not have to do.

Paul Simon

0
0

1 COMMENT

  1. What is particularly sad is that our own government leaders (MLAs and senior Civil Servants), too, deny that they have a spending problem, and are looking for new sources of revenue.

    Elsewhere in today’s Compass there is a report on the cost of living in Cayman. This expense is directly attributable to our bloated public sector, and to the taxes (mainly Import Duty) that are levied to pay for it.

    Will the FCO’s visiting team of accountants fix our problem? Doubtful! The FCO’s first suggestion was that we pay Income Tax, for goodness sake. Our local politicians (and their cronies) are forever searching for sneaky new ways of taking our money – any solution except imposing meaningful cuts in Public Expenditure, in fact.

    0

    0

Comments are closed.