(CMR) The United People's Movement Government is reconsidering its decision to impose a duty stamp hike on high-end properties, Premier Juliana O’Connor-Connolly said.
O'Connor-Connolly was addressing persons attending the Chamber of Commerce Economic Forum last week.
During her budget presentation in December, the Premier listed the increased stamp duty among new revenue measures projected to yield additional revenues of $52.0 million in 2024 and $80.0 million in 2025.
However, this announcement stirred concerns among local developers and realtors, who expressed that while many Caymanians may not purchase these high-end properties, the effects could eventually trickle down to Caymanians. There were also concerns that the stamp duty increase could make buying these properties less attractive for buyers as stamp duty comes directly out of pocket because banks do not cover stamp duty.
Speaking on the 2024-2025 budget, O'Connor-Connolly said, “The Cayman Islands is currently playing catch-up to meet the needs of our economic and corresponding physical and population growth. “
“The decision to introduce new revenue measures wasn’t taken lightly, and we have made every effort to ensure the new or increased fees are non-inflationary and do not impact the cost of living for the average Caymanian,” she stated
“Right now, we as a country are faced with the task of playing catch-up in so many areas. We are trying to build roads, houses, schools, waste management facilities, sewerage upgrades, and more to deal with a population that has grown faster than our infrastructure,” she added.
She said while playing catchup, some planned capital projects were in preparation for future growth.
O'Connor-Connolly explained that New Capital Projects are to be funded by borrowing under the guidelines of the Principles of Responsible Financial Management as specified in the Framework for Fiscal Responsibility (FFR).
She said the proposed borrowings of $150.0 million will be used to fund the Government’s Capital program and will not be used to fund Operating Expenditures, which are being adequately funded by Operating Revenues.
“Assertions have been made that we will unfairly load future generations of Caymanians with a burden of public debt through the proposed borrowing to fund capital projects. First, I maintain that this is just patently untrue, as the borrowing is prudent, responsible and well within the FFR stipulations,” the Premier stated.
She said that even with this borrowing, Cayman's debt-to-GDP ratio will still be under 10 percent, one of the best ratios in the world.
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