Marco says ‘no’ to bigger duty allowance
(CNS): The finance minister has said no to a proposed increase in the duty allowance from $350 to $500 because it will cost too much. Marco Archer said government has limited options for raising fees and it cannot afford to cut off revenue streams, when he revealed government was not supporting a private member’s motion to increase the duty-free allowance for people returning home from overseas trips.
Marco Archer, Minister of Finance & Economic Development
The minister told the Legislative Assembly that it could cost the public purse millions of dollars and that the existing allowance already compared favourably with many other jurisdictions.
Archer was responding to a motion filed by Ezzard Miller, the independent member for North Side. Miller was proposing the increase of $150 for those travelling on a Cayman passport, as he said the allowance has not been increased for many years but the cost of goods had, and it would give some relief at a time when local people are continuing to struggle.
The finance minister was not swayed, however, and pointed out that duty was a major earner for government, given Cayman’s tax model and its limited revenue streams. He said government had to be careful as it could easily find itself in difficulty with the government books. Archer said that it would also require increased manpower to police a different level of duty allowance for locals versus non-Caymanians. He pointed out that many Caymanians have more than one passport and may travel on US or BOT passports.
He said the $350 allowance was already quite generous, as he listed numerous countries in the region that had much lower allowances than Cayman and considerably more restrictions. The minister added that everyone in Cayman can bring back $350 worth of dutiable goods duty-free no matter how many times a year they travelled and regardless of how short the trip was. He also pointed out that the allowance applies to children and not just adults. Other countries limit the allowance to adults only or to trips over a certain amount of days and some limit the amount of times a person can claim dutiable goods.
During the debate his government colleagues, Roy McTaggart and Minister Wayne Panton, also noted that government was trying to encourage people to buy local and help the domestic economy and small businesses but the motion would have the opposite effect.
But the bottom line was government could not yet afford to lose what could be as much as $30 million a year. Archer said government still had some way to go to reduce its borrowing and comply with the PMFL and free the budget from the UK’s control. He said CIG could very easily, if it was not careful, find itself with a revenue problem.
Arden McLean, the East End member who seconded the motion, argued that other countries may not be as generous but they had much lower costs of living. He also suggested that Cayman has “always taxed the poor man so that others can survive” because of the taxation system. He pointed out while the rich can get duty concessions, very few things are taxed on capital gain so the poorer people suffer.
McLean asked at whose expense government was reaching a $120 million surplus when this small duty adjustment could help the working man.
He also raised concerns about how many people who can well afford to pay are being dishonest about the duty and doge declaring goods when they come home. The East End member urged people to declare the goods that they should be paying for and for customs to be vigilant about the wealthy residents who were flouting the law.
Miller was also unimpressed by the rejection and described it as another “sad day for Cayman”.
He asked the finance minister why he was so concerned about losing duty from regular people when he was “giving away millions in duty concessions to billionaire developers”.
Miller also wondered why, if buying local was such an important policy, the major developers were not obligated to buy building materials or furniture for their hotels locally.
“Dart gets millions of dollars in concessions and yet he is not required to spend one dime locally,” Miller added, pointing out the boost to local businesses if the Dart group was required to shop locally instead of taking advantage of massive duty concessions to buy overseas.
The North Side member said that major developments benefit very few Caymanians. “Most people will get nothing from Dart’s or the Beach Bay development,” he said, pointing to proposals for a resort in Bodden Town that is understood to be getting significant concessions from the current government if it goes ahead.
I think we are missing the bigger picture here. This country has a massive debt and our focus should be on reducing that for our future generations. This limit has been in place forever and it still hasn’t stopped hundred of individuals from hopping on a plane to shop some weekly. Correct me if I am wrong but if you are poor I am quite sure your main priority would not and should not be an oversea shopping spree. As an individual I would love to see it raised because it would mean I can buy more and pay less however that would be selfish me as I am not considering my country and the urgency at hand. I applaud Mr. Archer for standing his ground. His eyes are on the prize reducing the debt. I wish I voted GT central because he would sure get my vote. Eyes on the prize guys….BALLON PAYMENT IN 2019…DEBT OF OVER 5OO MILLION…LOVE OF COUNTRY NOT SELF!
Charge the business owners and foreigners. Marco needs a damn boot up his ass. Caymanians can’t buy nothing good here
Well done Marco. Ci$350 is very generous and your reasoning to not increase was valid. How much longer do we think that the government can keep funding the country
Who is the government here to fund if not the country?
Duty only applies to boxed goods that are too large to fit in luggage.
The $350 allowance only kicks in after the “I’ve worn these clothes in Miami already” allowance and “electronics that fit in hand luggage” allowance, both of which are quite generous.
“generous to certain people” you mean. Because I nor numerous friends of mine have never, ever, gotten through customs with any such leeway.
Maybe it is a result of your terrible sentence construction. Customs can tell you know.
Customs do tend to stop fat people because they tend to comfort shop more because of their low self-esteem and lack of discipline.
If I shop local and there are no locals working there, and the owner isn’t local, am I really shopping local?
Wake up people!
When developers create their own construction companies and use little to no local workforce, it’s really not a local company is it?
Or when a restaurant carried out business and not a single Caymanian works there, what does that tell you?
Small Caymanian business owners have no support by these jokers, look at the people they use to care for their properties, or the bar maids they sponsor to attend school at UCCI, they are quick to hang out with the high profile investors yet they don’t attend school job fairs or spelling bees, why? Because they are in it for them selves, every last one!
That’s the truth right there.
Yes you still are shopping local. Local is the area you are shopping at, not an ethnicity.
By shopping local even if the shop is owned by those despicable expats with their excellent customer service, then the government receives all the duties on those goods, the T&C license as well as the extra funds the employer and employees earn in the local economy. And if the money is wire transferred elsewhere the government receives an additional 5% tax on it
well here is my 2 cents technically all of your money goes of shore to he brackers after all they are the majority business owners in cayman
If anything the duty allowance should be lowered. Or changed to an annual limit instead of per trip (a la Bermuda).
The current duty allowance is yet another regressive transfer from the poor (who can scarcely afford shopping trips to Miami and so have to buy everything on island paying full duty) to the rich, who travel often.
The richer you are the more often you travel and the more you travel the more duty you escape.
Why not ditch the allowance and lower the rate for everyone?
While you’re at it, let people prepay the duty online! Most people smuggling purchases in aren’t avoiding the payment, they’re avoiding the half hour wait to pay it! The last thing you need after a long trip!
What a farce. I always declare my full amount, and pay every cent of duty every time I return from a trip abroad. It is almost impossible to spend less then CI $350, especially when calculated at .84. Yet, whilst I am claiming on my one small carry-on other residents are whizzing through the customs line with multiple checked bags, and paying nothing. Increase the allowance to a sane number, and make everyone pay. I assure you Govt will not lose money.
While I agree with you that many people have spent 10 times as the allowance but yet declare nothing, more luggage does not always equate to more spending. I also observe that a lot of the people I hear bragging of not paying duty are actually people who can afford it.
cns: please do an article/investigation as why grocery prices have stayed the same or gone up….even though shipping/fuel cost/power…etc has been falling?
No need for an investigation, the reason is clear. Cartels and monopolies. Time for an independent body with teeth to put that right! Oh, I forgot where I am, the brotherhood would never allow that!
If the numbers are correct, then duties on overseas purchases are over 60 million. Why not do away with the 350.00 exemption entirely and make all groceries duty free. You do not have to travel and buy “stuff”… Everyone has to eat. With a typical retail grocery mark up, prices would come down about 25%, so everyone would save.
Nice one Mr Ezzard, just for the Caymanians and just for those people who have enough money to go off island shopping. Good job you don’t put any effort into splitting the population into them and us!
What a joke and a poor excuse! People time for change. Marco I beg to ask you to advise the people of this country why NRA is in the bush cutting roads up to ironwood development when the developer should be doing this? Stop ripping the caymanians off Marco!!!
The simple answer is that is nor correct. The NRA is not “cutting roads up to Ironwood”. I am sure that isnt a revelation to you though.
Poor excuse in all respects.
I don’t understand how Minister Archer can say that Government could lose as much as $30 million dollars if the duty allowance is raised by $150. Assuming a duty rate of 20% it means that he is indicating they would lose revenue on about $150 million dollars worth of goods, above and beyond the current $350 allowance. I seriously doubt that Government collects anything close to that figure per year from those returning from overseas shopping trips and I don’t see how raising the limit will adversely affect local businesses. Those who want to buy from overseas can simply order from Amazon.com and import their goods using any of the various freight agents who operate locally, without having to buy an airline ticket. Maybe raising the duty allowance might stimulate more locals to travel overseas which might in turn cause Cayman Airways to depend less on the government for an annual subsidy.
They guy is clueless, what you point out is basic arithmetic, how this could be vetted by all his advisors and he shows up in the LA and regurgitate such crap is beyond me. I don’t know who is advising him but he seriously needs to apply some common sense logic to what they tell him before he repeats it in public and comes off looking stupid.
Good grief, an Island full of Sudden Finance Ministers!! One thing is clear. Cartels and fixed prices here in supermarkets and so on do not encourage people to buy locally-there really needs to be an effective force to look into and control these rip off merchants.
all the mla’s are a joke
Has any of the politicians who were exposed in using government’s credit cards to buy personal items overseas produced declarations confirming that the duty was paid each and every time?
I’m hoping the honourable ministrer didn’t mean CI$ 30mm would be lost as a result of the proposed CI$150.00 increase. Let’s assume the Govt losses CI$ 150x 22%= $33.00 per passenger returning. This means it would take over 900,000 retruning locals to incur the CI$30mm loss which we all know is impossible with a population of under 60,000.
McCarron.
If you were in these guys shoes, you wouldn’t be wanting to lose a dime. they have to pay down on that 600 million dollar debt the PPM put us in.
So the proponents wish to assist the regular Caymanians who would have just spent about $1000 for a weekend trip by allowing them to bring in an additional $150 of purchases duty free?
I am a regular Caymanian and it would seem to me that if I was that concerned about the extra $150 I should have serious misgivings about spending the $1000 in the first place. Maybe I should have kept the $1000 and just spent a part locally.
Here’s a way to make up any short fall in government revenue caused by raising the duty allowance. Get traffic police to stop speeders in school zones when the yellow school zone lights are flashing.
Ian, exactly!!!!!! Why oh why they don’t do that? They could be raking money if traffic laws were enforced!
better still just ticket people who don’t use indicators on roundabouts……….
And ticket those “gansta rider” drivers and passengers with seats reclined
Supporting the local economy is a good thing. But what gets me is having to accept poor customer service from sour faces. So, I will enjoy my Miami trips and getting a wider variety AND smiling faces that understand that am the customer and they want me to spend it in their stores.
Businesses here need to realize that customer service is seriously lacking, and some of their “customer service” people are poor at it. Paying top dollar for something is a lot easier to accept when you get good service. But when it involves screwed up faces and bad attitudes, I can go online and get it sent to me.
I prefer to pay the duty, which h is already added to the goods purchased locally, than going into a store where they make you feel like you begging them and they doing you a favor.
If one is traveling they are going to buy overseas anyway, that is part of the holiday even if the same thing can be purchased locally and at the same price. Increasing the allowance by $150 is not going to affect the local market one bit. That is just an excuse.
More importantly we are being told we have a 120 million “operating” surplus, that we should pat the PPM on the back, yet now we are being told that they can not afford a meager fraction of that for local people to enjoy on their holiday??
Thank you for assuming we are daft.
$350 is good enough. As Minister Archer says this allowance is for adults and children and no matter how many trips a year you make. The government MUST have revenue to keep,the country operating. If we don’t have this and other forms of taxes how do you expect the country to,operate.
They’re all for the rich only. Wonder how much concessions Marijana is getting. At least DART hires Caymanians and pay good wages. She pays dog wages and only has one Caymanian hired.
Serious allegations. Labor department? Immigration?
It isn’t allegations. It’s the truth. There isn’t a minimum wage law and both immigration and labor board knows it.
I agree with Ezzy on this one. I don’t buy anything on island a part from groceries.
North Siders could learn a thing or two from Marco. Just say NO to Ezzard!
Both are right and make no mistake the Express(create for Politicians) Don’t stop me pay no duty line at HM Customs Airport is well used by friends and family of our political honcho’s all 14 Bags and nothing to declare! Yes Marco you are in nice cozy Sweet Spot, God forbid you give the common people a little break?
Ezzard again hit the nail on the head.
More like the nail has hit Ezzard in the head again, the hammer too.
third grade math that is another reason why your country is a failure Marcos # don’t add up
I went over it 10x and cant see how we could loose any more than a few $ especially since
the increase is for caymanians only. and then aden sayng only the rich would benefit another 3ed grade comment .
lets look at the basic math
to loose $1 million in duty means each of the extra $150 allowance would have to be used by 20000 locals not paying $50 each in duty on overloaded bags. I just don’t see it
No – it is not for Caymanians. It is for Cayman Passport holders. That is not the same as Caymanians and includes lots of expats.
I’m pretty sure that having a Cayman passport means you are a citizen which means you are Caymanian.
I wonder what that comment means? passport holders being expats is that what you are saying I wonder how many cayman passports their are 31000?19400?
perhaps 42k?
that said the math is bullsh*t
and I think your comment has racist undertones at the end of the day
This is exactly right and I am always amazed at how many people (including, obviously, Ezzard Miller) fail to understand it. If you have PR, you can be naturalised as a BOT citizen. Then you can apply for a BOTC passport (which is what a Cayman passport is) and you have BOT citizenship. “Caymanian” is a residency status invented and conferred by the Cayman government, is quite separate from the passport issue, and is not a citizenship of any kind. Plenty of residents (including me) have a “Cayman passport” but not Caymanian status (nor can I vote, which also seems to confuse people). You may not like or agree with how it works, but that is how it is.
Marco stop your small mind thinking running a country is different from running a pattie shop.
The ppl of this country are hurting and your lack of vision and knowledge allows of sufferring to continue on a daily basis.
Perhaps my understanding of what it is to be poor is wide of the mark? I always thought that the well off were the ones taking overseas trips involving flights, car hire, hotels and shopping. Perhaps a way to help all people is to reduce the cost of government rather than spending money, allowing a targeted reduction in duties and fees that would genuinely help the poor in particular. Over the years I have not noticed any politician making such suggestions, including Ezzard and Arden, and I wonder how in touch they are with the poor if they believe that such people take overseas shopping trips.
This guy is such a joke as a finance minister. He has no vision for this country instead creating economic stimulus he is actually making the economy strink and thighten.
I guess it is clear. If you want duty cuts you have to be one of the rich elite in the world. the common folk who need the break don’t stand a chance. Tell me where the justice is in that.
get off your high horse, if the duty cut did go through it would apply to only 50% of the population and the remaining 50% with no cuts include those who make up 70% of the low wage jobs, the real poor of Cayman.
And here you thought the PPM was for the people, bless your soul. My darling, this is what is known as “True Colours shining through.”
Ezzard and Arden sure can lay it on thick. Anytime you see them propose something for “Caymanians” and not for anyone else, they are just vote buying. If you want to raise the allowance, fine, but why not propose it across the board?
I agree with Marco on this, and raising the allowance encourages people to buy overseas. Buy local!
If you can go overseas to shop/ vacation and can shop so large that you would experience hardship in paying duties if you are over the limit then you should not have taken the trip. Government need the surplus, I applaud Marco for not supporting it – he and the government has to work hard to dig us out of the hole the previous government put us in. I know some imbecile will come back with the comment about spending money on the schools and Admin building but at least we can see where the money was spent and it definitely was not spent in Casinos and other unscrupulous waste of our money.
Correction. It was the PPM government that ran up the debt. Check out the Clifton Hunter High School which cost over 100 million but is worth only 60 million and the derelict JGHS which is a graveyard of “the school that never was”. Wasted millions of dollars and wasted minds.How short is your memory? Paying down the debt is absolutely the responsibility of the PPM. We will never get back the students they cheated out of their education and the price tag on that is monumental.