Economy of the Cayman Islands
The Cayman Islands have for many years enjoyed a thriving economy with literally zero unemployment.
Construction of new homes, hotels and condominium projects keeps developers busy, and land sales increase almost every year.
To keep pace with the development requires the importation of foreign labour, and there are currently around 20,000 foreign workers in the Cayman Islands. The tourism industry also continues to boom with a continual increase in cruise ship passenger and air (stay-over visitor) arrivals. Seven Mile Beach is one of the most popular stretches of beach in the world and is where you’ll find many of the finest hotels and condos. Servicing the needs of over one million visitors a year also requires the help of foreign labour.
With a population of approximately 60,000 there is a huge trade with the US. Most locally consumed goods must be imported, and almost all food, clothing, electronics, building materials, automobiles, etc., are imported directly from Miami or Tampa, Florida. Large container ships arrive several times per week with supplies, and air cargo operators deliver fresh produce and other goods regularly.
The financial industry continues to boom with new businesses constantly arriving and established businesses expanding. Each year sees thousands of new company registrations, and there are now over 90,000 companies registered in the Cayman Islands. The financial industry is well regulated and stories of the Cayman Islands being a haven for the profits of illegal activities and money laundering are greatly exaggerated. Strict financial supervision and cooperation with US authorities on cases involving the proceeds of criminal activities has led to many arrests both locally and in the US.
Many persons have asked how the local government gets revenue if there is no taxation locally. Well, in simple terms, there are taxes, but not on your salary or the profits of your business. Taxes, otherwise known locally as fees and import duty, are assessed on many items and services. A few of the major sources of revenue are listed below:
- Imported goods, including food, building materials, automobiles, fuel and alcoholic beverages
- Land or property transfers (6% to 7.5%)
- Tourist accommodations (10%) as well as airport and cruise ship passenger departures
- Banks, Trust and Insurance company licences
- Company registration
- Telecommunications operating licences
- Work permits (Work Visas)
- Business licences