Discussion topics for economy forum

NOON DAY FORUM TOPICS

By

Sir John Swan and Larry Burchall

Sir John Swan and Larry Burchall will be hosting a noon day forum on the state of Bermuda’s economy. The forum will be held on Thursday, Janaury 19, 2012 at City Hall Theatre from 12:00 p.m. to 2:00 p.m.  Following are some topics that are going to be discussed along with preliminary notes on how Bermuda’s economy can benefit.

These recommendations are in answer to the following question:

“What can the Private Sector do to kick start the economy with Government only being called upon to change policy and legislation and not make any expenditure?”

Recommendations on how to stimulate the economy…

All of the following recommendation can be implemented by policy and legislative changes that could be done within one – two months and would have an immediate effect on the economy.

City of Hamilton

*     Extend the city limits to allow for the development of high rise condos by International Business for “key” employees.

This would be the only area this would occur which would help keep congestion out of the rest of the Island.

*      Make City of Hamilton an Economic Zone

• Duty free on materials for construction  & Payroll Tax concessions

This would stimulate the construction sector.

• Allow for foreign purchase of apartments

Most foreigners are used to living in a city environment and this would keep the outlaying Country areas available to Bermudians and their families.

• Remove restrictions on law & accounting firms

They can encourage current clients to move their legal and financial services to Bermuda.

*     Development of the Waterfront to include:

• Convention/Entertainment Center
• Casino
• Restaurants
• Retail shops

This should be a high priority and any discussion on cruise ship gaming should be only after a policy on gaming is determined.

High Net Worth Individuals

*      Allow for approval in principle to bring “key” employees, both professional and domestic, with them

They would have to pay payroll tax for these employees which would translate into additional Govt. revenue.

*      These individuals will require various services such as transportation, home renovations, legal etc.

Therefore if the Bermuda does not have the domestic portion of employment, they would still find jobs in these other areas that would still need to be catered to.

International Business

*      Remove the 60/40 rule

Property Ownership

*      Relax ownership restrictions on married couples where only one is the Bermudian. Purchase of the 1^st property would not require government approval

Why should a Bermudian be penalized for wanting to own “a piece of the rock”? This would translate into Government revenue by ways of duties and fees.

*      Lift ownership restrictions on PRC holders to allow for the purchase of one property

These PRC holders are told that they can reside in Bermuda until they die, but yet are restricted from having a house to die in. Allowing them to purchase a home would again translate into Government revenue by way of duties and fees.

*      Liberalise immigration policy to allow for Bermudians to sell to non-Bermudians where property is above a set ARV

Bermudians lose with the current legislation as it puts the foreigner at an advantage as they are the only ones who can sell to other foreigners. This would enable Bermudians with large properties to compete with the foreigner who has a property for sale. This would be additional Government revenue by way of duties and fees and foreign exchange.

This would also stimulate the construction industry as these foreigners would like to remodel their new purchases and therefore creating jobs for Bermudians.

*      Change condo ownership policy to allow for Bermudians to sell to non-Bermudians where property is above a set ARV

Same reasons as stated above.

*      Restrict land ownership of companies after 60/40 removal to:

• Major Infrastructural Projects: 100% foreign ownership of the facility with long term leasehold on the land. Company must be listed on the BSX

• Major Service/Utility Companies: Foreign ownership of real estate for the purpose of operation and management of the business. Company must be listed on the BSX

In both cases above, Bermuda would have first class infrastructure facilities to compete with the rest of the world and Bermudians would still have the opportunity to be a shareholder of the Company and collect dividends.

• Commercial/Retail Business: Foreign ownership and management with Bermudian’s retaining real estate

This would improve the high end shopping for tourists, employ Bermudians and Bermudians would also collect rents.

Status/Residency

*      Open residency rights to a wider qualifying group

Implemented by Government Jan.1.12 to “Key” employees of companies who meet certain requirements. Even if the individual does not employ Bermudians but is very philanthropic they should also be considered for PRC.

*      Grant Bermudian status to a limited number who are existing PRC Holders

Bermudians status should be an honour that is granted and not bought. This process could be done by way of nomination, similar to Queen’s Birthday honours and every Bermudian would have the opportunity to nominate someone.

Taxes

*     End senior benefits such as free land tax above a set ARV

If a senior has the means to have a large home, they should have to pay their land tax which would translate into more Government revenue.

*      End senior benefits of free car registration above a set vehicle class

If a senior can afford to purchase a luxury or large vehicle they should have to pay the registration fee. This would increase Government revenue and it would also stop the fraud that is occurring with grandchildren and children putting cars in senior’s names to avoid paying the fee.

*      Payroll taxes should be reduced to zero for at least three years for employers paying full-time Bermudian employees and self-employed individuals (e.g. Taxi drivers) receiving less than $50,000 per annum

This would lift the burden on persons who are already struggling to provide for themselves and their families.

*      Offer a two year payroll tax holiday for:

• new international or local business which hires Bermudian employees
• new Bermudian employees hired by existing businesses

This would encourage businesses to give Bermudians jobs.

*      Remove tax on boats and increase mooring fees to enable Bermuda to become an international boating centre

This would encourage more foreigners as well as Bermudians to bring their boats here. This would translate into more jobs at marinas and an increase of revenue to the Government – “Queen’s Bottom”.

Telecommunications

*      Bermuda should free up the telecommunications market to maximize new opportunities in technology and minimize cost as a result of competition

This would increase competition and make Bermuda more relevant in the international stage. Due to our limited resources when the latest technology is offered we should have an open mind to make Bermuda as current and efficiently connected as possible  e,g, most place worldwide are  into a 4G network and quickly moving beyond that. Bermudians would also benefit as they would be able to get more for their dollar.

Work Permits

*      Allow companies during the incorporation process to apply to immigration for approval in principle of “key” employees and both processes should be executed in a prescribed time period

This would facilitate the companies’ ability to raise capital by satisfying investors that they can get certain “key” employees. Immigration should be able to tell the company that they can have “X” number of employees as key.

*    Remove term limits on work permits

This would be for “key” corporate employees.

This is a collective effort and we need your support, comments and ideas. So come out and here how Bermuda’s economy can be regenerated.

 For further information or to express your comments email us at [email protected] or visit us on Facebook at Regeneration of Bermuda’s Economy.