Respect the Law and avoid taxes legally…

Taxation Law: the Luxury of Paying No Taxes in Grand Cayman Island

Grand Cayman Island is part of the British Overseas Territories, which are in the western Caribbean Sea. There are a variety of islands located in the British Territories. The other islands in the area are Cayman Brac and Little Cayman. These islands are renowned in the world for being a financial fortress for business.

Did you know that the Cayman Islands have more businesses registered in its location than people living there? Here you can get an idea for the popularity of Grand Cayman as a financial haven.

For stocks, there is no capital gains tax, which makes Grand Cayman Island attractive for investors. No matter how much you earn on an investment, you do not owe any taxes to the government. The Cayman Islands Monetary Authority oversees all hedge funds, investments, corporate governance activities, and structured finance activities in the island.

With $1.5 trillion dollars in banking liabilities, Grand Cayman is the fifth-largest place for banking in the world. Over 280 banks are located in the Cayman Islands. 19 of the banks are allowed to conduct banking activities with Cayman based clients, while the other banks are only allowed to conduct business on an international scale with certain transactions.

Hedge funds in particular experience ridiculously large growth rates in the Cayman Islands. In 1993, the Mutual Funds Law was passed which helped position the Cayman Islands as a home to the greatest number of hedge funds in the world. In 2008, over 10,000 hedge fund registrations were passed in the Cayman Islands. That same year, these hedge funds experienced a 12% growth rate.

While the Cayman Islands has come under pressure for its tax practices, they consistently are able to regulate their own financial practices without outside intrusion. In 2005, the International Monetary Fund even released a report commending the Cayman Islands for its strong attention to its tax practices. In 2009, President Barack Obama condemned the Cayman Islands for being a shelter for relaxed tax practices, but the Cayman Islands responded the next day with a letter detailing all of its tax plans.

The government in the Cayman Islands receives its income typically through indirect taxation. There are no taxes on products sold in the island. There is a 20% duty tax on imported products into the island. There is also a 10% tax fee on tourists accommodations and up to a 40% tax on automobiles.

Overall, Grand Cayman is the ultimate place to live for people in the financial industry, since they will always have a job and no taxes!

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