An amendment to the Land Holding Companies Share Transfer Tax Law increases the tax on land transfers to 7.5 percent from a 4 percent tax for Caymanians and 6 percent for non-Caymanians.
Finance Minister Marco Archer told the Legislative Assembly in June that the land holding companies’ transfer tax was supposed to change in 2012 when the individual and business land transfer tax rates were increased to 7.5 percent.
“With respect to the transfer of shares within a company that owns land, The Land Holding Companies Share Transfer Tax (Amendment) Bill, 2013, was approved by Cabinet in Feb. 2013, but was not passed in the Legislative Assembly to amend the law,” Mr. Archer said in June.
The tax applies to any transfers of equity capital from a land holding corporation. Legislative Assembly members passed the amendment on June 19 and it came into effect last month.
“As a result of the Land Holding Companies Share Transfer Tax Law (2007 Revision) not being amended, the Lands and Survey Department has been charging the rates of 4 percent and 6 percent, when it was the government’s intention back in 2012 to charge 7.5 percent,” the minister said.