Duty free allowance to increase to $500

| 05/09/2018 | 68 Comments
Cayman News Service

Customs sign at the Owen Roberts Airport

(CNS): From 1 November Caymanians and residents will see a $150 increase in the amount of goods they can bring home under their personal duty-free allowance. Premier Alden McLaughlin announced the government’s decision as he began a ‘State of the Nation’ address during the special State Opening of the Legislative Assembly on Cayman Brac. McLaughlin said the increase in the allowance from $350 to $500 represented somewhere in the range of $1 million in lost revenue for the public purse, but given its prudent fiscal management and increase in revenues, government could afford the small loss in taxes.

“Our careful stewardship of the national finances makes this is an affordable amount for government to forego while being another welcome reduction in the burden of duties on Caymanians and residents,” he said.

McLaughlin said it was part of a wider plan to encourage proper declarations at the airport as well as providing the people with some useful monetary relief when returning home from their annual vacation and shopping.

He said that with the introduction of the new customs system, government had opted to use a carrot, by upping the duty-free allowance, rather than a stick of fines to improve compliance with the amounts people declare over their allowance.

“Increasing the fines on those who evade duty is an alternative. Our preference is to offer a ‘carrot’ rather than to rely on ‘the stick’ approach,” the premier said, as he announced the increase to $500 emphasizing it was for purchases imported for personal use, not for commercial purposes.

“I believe the vast majority of Caymanians and residents will welcome this increase in the duty allowance and will abide by the rules requiring them to declare any goods imported over that limit. However, if there is abuse of the system and if it is determined that an increase in fines is also needed to combat abuse, then …we will certainly take that into consideration.”

McLaughlin said the Ministry of Finance had analysed the loss to government coffers by examining actual declarations made by arriving passengers over time and concluded it would cost government around $1 million.

The increase in the allowance is likely to be welcomed by the opposition as Opposition Leader Ezzard Miller has been campaigning for several years for government to increase the duty-free allowance to $500.

In 2015, former finance minister Marco Archer rejected a private member’s motion filed by Miller for the change saying that it would cost the public purse millions of dollars, suggesting it might be as much as $30 million. The current finance minister, Roy McTaggart, also argued at the time of that debate that government was trying to encourage people to buy local and help the domestic economy but increasing the allowance would have the opposite effect.

But three years on, with the government’s revenue stream healthier than it has been for many years and forecasts for a significant surplus at the end of this budget cycle, the revelation that it stands to lose only around a million dollars, as opposed to $30 million, means the change is likely to be well received.

With the introduction of the ‘Customs Green Channel’ at the airport arrival hall, the onus is now on local people arriving home from overseas to be honest. It is also making things smoother for visitors and allows the customs officers to focus on intelligence rather than suspicion when it comes to stopping and searching.

Although customs officers reserve the right to stop and search anyone passing through the ‘Green Channel’ if they are suspected of breaking the law, McLaughlin said border security depends on specific intelligence.

“This is why we recently passed legislation to allow the Cayman Islands to participate in the Advanced Passenger Information Programme – receiving early warning of individuals of concern that are on their way to our airports and seaports,” he said. “This is the direction that we are working towards: intelligence-based vetting that has the best chance of stopping those bringing in contraband or trying to circumvent the Customs Law.”

He said the new process was designed to significantly improve security while making arriving and passing through customs and border security at the airport much easier and faster.

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Category: Local News

Comments (68)

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  1. Anonymous says:

    This concession may have detrimental consequences. Nobody likes taxes, fees, etc., and this $150 per person extra definitely will help the bottomline of travelers.

    However, this is 1., a direct loss of revenue to central coffers, and 2. may very well impact the bottomline of small businesses which are already struggling. The $1 mil seems far too low and the $30 mil makes more sense if this was reflective of loss of nationwide transactions. A realistic estimate may be more along the lines of $15 mil loss in small business transactions aimed at the retail sector.

    It may have been a wiser move to offer import concessions to small businesses. While this wouldn’t guarantee the savings being passed onto consumers, it may have offered greater long term results, since the market would self-correct, which is increased buying power locally and increases revenues for small business.

    The cost of doing business locally is extremely high when factoring shipping, duty, cost of goods, as well as rent, cuc, staff, h.i., pension, and some kind of profit.

    A greater reduction in planning fee dependency, greater concessions for resident-use condos to bring down family rents, diversification programmes for energy to reduce cuc, and greater diversification in economic activity (i.e. agriculture, manufacturing, blue collar trade, tourism), will offer greater long term success.

    The Government should be applauded on some recent moves to alleviate tension for individual families. Would just caution that the long term strategy should still be a focus of creating a strong independent culture of men and women.

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    • Anonymous says:

      11:12am

      Another side of the story:

      If small businesses are struggling then either shut down or become more competitive.

      Third side of the story:

      CIG has made it difficult for small businesses to stay afloat. Taxes, unnecessary regulations, lack of enforcement of level playing field regulations, and so on.

      Fourth side of the story:

      Make your voices heard.

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    • Colin Anderson says:

      No doubt this was composed by a small business. In my opinion some small businesses are very unfair to persons buying locally as are larger ones. i refer in particular to the offering of much shorter warranties than the manufacturer offers and many stores refund policies. Personally i would buy on mainland and accept the duty knowing that in the worst case i can get it sorted on my next off island trip.
      in summary give us our proper consumer rights and we might just give you our loyalty

  2. Anonymous says:

    So a family of four will get USD$2500 in duty free allowance…seems like a lot to me. People will still de-tag their clothes and scuff in their shoes.

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  3. Anonymous says:

    @8.45 In the year 2525

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  4. Anonymous says:

    Don’t forget Marco Archer and the PPM refused to do this in 2015
    So

    As usual the government doesn’t act prior to issues and does not have the foresight to attempt to legislate forward

    They are always looking back, correcting issues that they caused in the first place

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  5. Anonymous says:

    Presumably if you’ve worn it or used it it still doesn’t count, right?

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  6. Anonymous says:

    but what time, if a flight is delayed on the31st october till midnight will you get the $500. or scheduled time? or 7am on the 1st? we need to know

    😉

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  7. Anonymous says:

    Boy, I be doing way more than dat for donkey ears.

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  8. Anonymous says:

    But less money for local business keeping local’s employed!

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    • Anonymous says:

      Not really, unless it is an emergency or car related, I don’t buy anything but food here…crazy prices and little choice. Why would you? A welcome relief.

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  9. $312 million govt bond due next year November says:

    That lick coming up sooner than you think.

    Govt saved up $230 million but then decided to brag about saving that amount, and is now doling out spending the money $10 million here, there and everywhere WHILE DELIBERATELY MISLEADING PEOPLE BY REFUSING TO TELL THEM THAT THIS MONEY WAS TO PAY FOR THE $312 MILLION MORTGAGE!

    Oh wait, never mind that…our favourite vulture capitalist is reportedly in deep negotiations with the Chinese and the CIG to build the cruise port can pay off Cayman’s govt bullet bond next year.

    The same vulture capitalist who also bailed out Argentina and Greece by buying up those countries’ govt bonds forcing those countries into BANKRUPTCY!

    Yeah, that lick coming sooner than you think if they don’t stop spending out our QUARTER BILLION DOLLAR SAVINGS SO WE CAN PAY THIS

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    • Anonymous says:

      CNS, did you not hear McKeeva shipped his SUV (at our cost) to the Brac for the LA meetings. He also shipped his driver over there. So while everyone else is walking or using local means he just had to be driven around in his own SUV which will be shipped back to GC at our cost too!

      CNS: No, we had not heard that. If it’s true, can someone send us a photo please?

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  10. Cayman Vantage says:

    The Government is in real trouble folks never seen so many kimicks and eye catching tricks big announcements i am waiting for the bitch lick!!!

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  11. Anonymous says:

    Of course a higher duty allowance makes perfect sense and I’m glad it’s being implemented, but the real improvement to discourage people from not paying required duty would be to address the absolutely ridiculous payment process. When one does end up having to pay, the line for payment is painfully long. I recently waited an hour and a half to pay, all because the process is 100% pen and paper. The customs reps were working painfully slow without a care about how long people were waiting AND they had to record the transaction completely BY HAND on a paper ledger. If customs got up-to-date with 1990 by computerizing the process while simultaneously addressing the reps’ desire to have personal chats while working, then maybe we’ll have true progress with custom’s duty compliance.

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    • Anonymous says:

      THIS!

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    • Anonymous says:

      Amen, I have asked several higher ups why this process has not improved and not received an answer. Whey cant they have a kiosk of two (ie ATM) where while waiting for bags I can declare being over the limit, pay extra duty and show the receipt to the office on the way out. I am making the same declaration and the office has a right to stop me and inspect my bags. Lets move into the 21st century.

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    • Anonymous says:

      I returned to the island Monday Aug. 27 having overspent my allowanceby a couple of hundred dollars. 90 minutes in line while “inspectors” basically waved through the 7 or 8 people in front of me, then over 30 minutes to pay. That’s my reward for honesty, My friends laugh and say “What?? You declared??? I never declare…”. Now I see why. No computers to be seen, just dollar store calculators and multi-part receipt books. Unbelievable. Lets get with it – ATM-type machines to pay your duty and I’ll bet the revenues will skyrocket. I believe people want to be honest, they just don’t want to be aggravated.

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  12. Anonymous says:

    Let’s think about this…. Increase allowance $150 for duty but not everyone is bringing things back, charge $50 per bag mandatory for CAL. This govt is just digging a deeper hole with losing business for CAL. Everyone is going to just start moving to other airlines such as Southwest, their prices are better and two “FREE” bags and now this duty allowance. Its great for us on the account of some really dumb decisions!

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  13. Ron Ebanks says:

    CNS , was the limit $500. 00 for duty free for Cayman islands residents some years ago ? I thought it was .

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  14. Anonymous says:

    CI$ or US$? Might help to be clear on this.

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  15. Anonymous says:

    benefits offset by cal’s new baggage policy. classic switch and bait by ppm.

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    • Anonymous says:

      Not really. First and second bags are US$20 each. The increase is still a great benefit to the passenger. Maybe show a little gratitude?

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  16. Anonymous says:

    When was the last time anyone saw an MLA line up in customs and pay duty anyway?

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  17. No state citizen says:

    Excellent!
    Finally, common sense prevails.

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  18. Anonymous says:

    Totally agree and thank you thank you. I listen to the Premier speech today. So much accomplished in just the first year of this administration. I think the poor Opposition must be shaking in their slippers.

    Thank you Premier and coalition government.

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    • Anonymous says:

      I think you mean “THANK YOU Hon. EZZARD MILLER”, 10:45. He suggested this last year, and PPM was against it. Now they had to watch their own spit fall back in their own face.

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  19. Anonymous says:

    There will be zero change in revenue. All this means is that I don’t have to wear my new panties in Miami before returning home.

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  20. Anonymous says:

    when?

    CNS Note: As in the very first line….. From 1 November

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