Rather than extend various duty rate concessions to Cayman Brac for an additional six months or a year, as it has been, the Cayman Islands government has agreed to extend those tax rate cuts until December 2020.
The decision was announced by government Finance Minister Marco Archer on Monday.
“I encourage all developers and other stakeholders to accelerate their construction activity during this further concessionary period,” Mr. Archer said.
The duty reduction extension affects the 100 percent stamp duty waiver on Cayman Brac, a 100 percent import duty waiver for building materials imported to Cayman Brac and Little Cayman and the concessionary import duty rate of 12.5 percent per gallon for motor gasoline imported to Cayman Brac.
In addition to the Brac import rates, the flat duty rate of 15 percent for the import of building materials to Grand Cayman has also been extended. However, that extension has only been done through December 2016, Mr. Archer said.
The normal duty rate for motor gasoline imports is 75 cents per gallon, and for building materials general import duties range from 17 percent to 22 percent.
Building materials included in the extensions are “all physical components and substances, whether solid or liquid, used in the construction, renovation or restoration and forming a permanent part of any building or related structure.”
Items like furniture, accessories, electronics and appliances are specifically excluded from the extension.
To qualify for a full stamp duty waiver on land purchases on Cayman Brac, the construction of a home, apartment or business premises has to be completed within two years. If the development is not finished in two years, the developer or homeowner must pay a penalty of 10 percent in addition to the normal stamp duty rate.
The government first introduced the duty concessions for the specific categories in January 2011 and has effectively continued those since that time.