Cayman Writes UK on Convention
Published 15th June 2013, 12:0pm
Letter to UK PM David Cameron from the Premier, the Hon. Alden McLaughlin, JP
7 June 2013
Dear Prime Minister,
Following my letter of 6 June, my administration reiterates our support for the UK’s G8 agenda on effective global tax and transparency standards.
We agree with your statement that there is ‘no point in dealing with tax evasion in one country, if the problem is simply displaced to another’. We therefore also agree with equitable adherence, including within the G8 countries, to global tax and transparency standards. Equitable adherence sets the foundation for full and effective participation, by all countries, in the true spirit of these efforts.
Because it is an important component of global transparency standards, Cayman has been monitoring developments in relation to the Convention on Mutual Administrative Assistance in Tax Matters. Following substantive talks with HM Treasury, we are now prepared to commit to join the convention. We look forward to further discussions on the particulars of the convention’s extension to the Cayman Islands, as balanced with the UK’s recognition of our fiscal autonomy.
In regard to the UK’s stance on anti money-laundering and countering the financing of terrorism, we fully support your goal of ensuring that countries have accurate beneficial ownership information on companies and trusts. Collection of beneficial ownership information by corporate service providers and trustees has been a legal requirement in Cayman for more than a decade. Obligations on corporate service providers to collect and retain such data are met through licensing and routine onsite regulatory inspections, and they are backed by disciplinary action when necessary.
As part of our ongoing commitment to AML and CFT, Cayman will produce an action plan that will include an assessment of our beneficial ownership regime; we will consider improvements to our regime in accordance with internationally accepted standards that are applied globally, again in the spirit of equitable adherence.
I note that our commitment to the convention, and to the production of an action plan, continues our longstanding contributions to global tax and transparency. This includes our high-level participation on the Global Forum on Transparency and Exchange of Information for Tax Purposes; our decision to enter into a Model 1 IGA on US FATCA, with similar arrangements for the UK; and our joining of the pilot on multilateral automatic information exchange.
In our view, these actions clearly demonstrate that in terms of our philosophies and engagements, Cayman and the UK have more similarities than differences. With this in mind, I thank you for your invitations to the 15 June meetings on tax, transparency and trade. I confirm my attendance for the private reception, and Cayman’s Minister for Financial Services, the Hon. Wayne Panton, will accompany me to the ‘Open for Growth’ meeting.
Indeed, in your 19 May invitation to the meeting, I read with appreciation your interest in seeing the Overseas Territories and Crown Dependencies flourish, as well as your acknowledgement of the well-established principle that countries have the prerogative to set their own tax rates.
This important recognition clearly is in line with your ‘Open for Growth’ theme, as it speaks to the benefits that international financial centres, like Cayman, contribute to the global economy – including the stimulation of cross-border trade and investment, which grows economies and creates jobs.
As Cayman has a track record of long-term involvement and proactivity in the areas of tax and transparency, we look forward to working closely with you on these matters of global importance, and to your acknowledgement of such at the 15 June and G8 meetings.
(Signed) The Premier, the Hon. Alden McLaughlin, JP
For more information, please contact the Financial Services Secretariat at (345) 945-5819 or via email at firstname.lastname@example.org.