Cayman Government Responds To Attack In British Media

by Amanda Banks, Tax-News.com, London

01 March 2004

The Cayman Island’s Financial Secretary Mr George McCarthy has hit back at “disingenuous” criticism of the jurisdiction’s dispute with the UK over the EU Savings Tax Directive, displayed in a recent article in the London Times.

Appearing under the headline “Pirates of the Caribbean refuse to play ball on tax havens,” the Times likened the jurisdiction’s financial sector to “an unprepossessing gang of bankers and lawyers lounging on the strips of sand… which claim a kind of allegiance to the Crown."

Commenting on the recent dispute between the Caymans and the UK over the implementation of the EU Savings Tax Directive, the article accused the jurisdiction’s government of “playing a game of chicken with the Chancellor, daring him to legislate and making cheeky demands for quid pro quos," adding that the jurisdiction was only interested in signing up "if you let us into your ports for a bit of financial raiding."

In a letter to the paper, McCarthy responded: "International business is attracted to the Cayman Islands because of the critical mass of experienced professional advisers, our robust and effective regulatory system, innovative products and services and an approach to tax which is business-friendly."

He continued: "We have signed and implemented commitments on tax transparency. We have consistently asked for fairness - a level playing field and equitable treatment. It is not a case of us asking to be let into your ports 'for a bit of financial raiding', but of the Cayman Islands correcting decades of negative spin by competing onshore financial centres."

Mr McCarthy commented that the transparency of the jurisdiction’s financial system is arguably greater than many onshore nations, and warned that such “disingenuous attacks” may tempt investors to move assets to jurisdictions outside of the reach of the OECD.

"For so long as newspapers like The Times address these complex issues in a biased manner, they will contribute to problems rather than illuminate them," he argued.

Recommended