Bringing consistency to Customs policy

Believe it or not – and Collector of Customs Samantha Bennett won’t believe it – we empathize, even sympathize, with her plight.

It is not her doing that import duties are a primary contributor of revenue to the Cayman Islands budget, and Ms. Bennett inherited an unpalatable collection of laws, regulations and practices that have ensnared her and her department in contentious issues (from wedding dresses to electronic goods).

The latest flare-up has to do with whether residents must, or should, register their electronic goods such as iPads, computers, smartphones, and an ever-expanding inventory of modern gadgetry, before they leave the island.

Doing so, presumably, will ensure smooth passage through customs upon their re-entry to Cayman because the serial numbers will be on file, thereby providing proof that they were in possession of the items before they left. (But unless part of the registration process requires actual receipts, there is no certainty that duty was ever originally paid – a flaw that could be remedied with an “amnesty provision” for previously purchased goods.)

Premier Alden McLaughlin, we presume, thought he was doing Ms. Bennett a favor when he held forth on this issue at a press conference last week – but he wasn’t.

In effect, Mr. McLaughlin blamed the public outcry over electronic items on the Compass for “the unfortunate perception that has developed since the news article and editorial” appeared, that perception being that it is mandatory to register those items before traveling.

For the record, the Compass never said the registration was mandatory (it isn’t), but certainly would be advisable if customs officers demand proof that these items are making a “round trip.”

Mr. McLaughlin then went on to say that he has never registered his items and doesn’t intend to start now, indicating he was unaware of anyone being hassled at the airport over electronic items.

(By the way, you show us the customs officer who is brave enough to confront the premier, and we’ll show you the bravest (and most likely former) customs officer in the Cayman Islands.)

In Cayman, returning residents are required to declare and pay duty on items they import. Some do, some don’t, and some do sometimes, but all who don’t declare everything, every time, are violating the law.

Actually, the electronics issue is largely a distraction and should not be addressed in isolation.

The larger, and much more intractable, problem regarding personal belongings of traveling residents concerns the other dutiable items in their possession – clothes, jewelry, cosmetics, golf clubs and so forth.

What is the logic of registering electronic items but not these other dutiable items?

Ms. Bennett broached this very issue on a talk radio show last week. Should we not be registering with customs all of the personal effects we might travel with? She seemed to be suggesting that we should, and, for the consistency of argument and enforcement, she’s probably correct. If you buy into the idea of registration, you must buy into the burdensome (and loathsome) consequence of registering everything.

What is definitely not palatable is Mr. McLaughlin’s “solution”: In effect, “Don’t worry; we don’t enforce those laws anyway.” Premiers shouldn’t talk that way, and countries shouldn’t act that way. A “wink-wink” approach to the law invites discretionary abuse or selective enforcement – or both.

Whatever the way forward, the public deserves clarity and uniformity from their leaders. If Premier McLaughlin endorses Ms. Bennett’s expansionary policy of “registering everything,” he should say so. If he disagrees, he should say that as well.

What is no doubt needed here is for Ms. Bennett and other government leaders to come together to hammer out a modern policy that has these characteristics: It must be easy to understand, easy to apply and, importantly, practical to enforce.

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6 COMMENTS

  1. I do not support persons who are putting Ms. Samantha before a firing squad because she is trying to enforce some laws; Furthermore those who are in authority to support her, should do so instead of speaking out of two sides of their mouth, and in the same breath to the media I say stop fanning fires

  2. Going after the odd traveller who abuses the system at the expense of the general public is and will always be a lose lose for customs.

    Even if the volume of lost revenue on these items was great, which I doubt it is, energy would be better spent recovering/expanding revenue in a much more productive way.

    Would it not be more productive to figure out what are the most commonly smuggled items and simply reduce import tariffs to a point where there was little to be gained by buying these items abroad in lieu of buying from a local merchant.

    Look no further than Walmart, Target, Bestbuy and the rest who have simple models that charge a marginal premium to an item but do very well on volume.

    In other words if the tariff is a whopping 22 percent then no matter what you do, you have incentivized a black market. Reduce the tariff to a more reasonable amount (read 10) and bingo, no point wasting time while on holiday and lugging that stuff.

    I am sure most people would rather buy in Cayman if the price differential was not so great. Good for the local economy and for the image of Cayman.

  3. More of a question than a comment.

    The duty free allowance is 350 KYD, about 420 USD.

    Let’s say you buy a new phone in the USA for 500 USD and this is the only shopping you have done and declare.

    Do you pay duty on the 80 USD difference or on the whole 500 USD?

  4. In answer to Norman’s question, as long as you declare it, you pay duty on the 80 difference, or about 18.

    I took the notice about registering your electronics as comment that customs are going to be a bit more interested in those items going forward. My 5 year old blackberry’s not going to get any questions!