A reduction in the cost of trade and business licensing fees for micro- and small-business owners which took effect Aug. 31, 2014, has contributed to doubling the number of licensed businesses.
Minister of Commerce Wayne Panton said a total of 1,467 trade and business licenses have been granted year to date under the incentive program, compared to 713 for the same period last year. Speaking in the Legislative Assembly on Monday, the minister said the numbers showed that the program “is working” and has had “a great deal of success.”
“Why does that matter? It now qualifies them, for example, to participate in private and public bids, where they could not do it before because they did not have proper valid business licenses,” he said.
The administrative incentives for the budget year 2014/2015 included a licensing fee waiver for micro businesses, which employ up to four people and have an annual revenue of less than $250,000.
Small businesses, which employ up to 12 staff and have annual gross revenues not exceeding $750,000, could qualify for reduced licensing fee of 50 percent in West Bay and George Town, and 75 percent in all other districts. To qualify for the reduced fees, businesses have to obtain a certificate of good standing from the National Pensions Office and provide proof of health insurance. New businesses require a business plan to benefit from reduced fees.
The program costs government approximately $1.4 million in foregone revenue.
“That is the value of the investment we are putting into this program because we hope to use it as a base to offer further benefits to business owners who are complying with the laws, who are reflecting an environment of a level playing of fair competition,” Mr. Panton said.
“That may involve, for example, incentivizing the creation of new jobs and further incentivizing the filling of those jobs by Caymanians as opposed to work permit holders.”
Minister Panton said government is focusing on small businesses to generate more economic activity and reduce unemployment.
“We know that small businesses by and large create the greatest numbers of jobs in the economy. And by helping them to be stronger and more successful, we are also enabling them to be the engine of economic activity and employment,” he said.