Turks and Caicos: Executive Summary

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Turks & Caicos Executive Summary

The Turks & Caicos Islands are located in the Caribbean. The Islands are a dependent territory of the UK with self-rule under a Governor and an elected legislative council. The 14 islands, south-east of the Bahamas, have land area of 430 sq km and a population of 40,500 'Belongers' plus expatriates; the culture is mostly Afro-Caribbean. The climate is sub-tropical; average daily temperature ranges from 17 to 30 Celsius; there can be hurricanes. The time zone is 4 hours behind GMT.

The official language is English and the legal system is largely derived from English law. There are international airports with daily flights to Miami (90 minutes) and more infrequent flights to other US cities, Halifax and London. The currency is the US dollar. Unemployment is high, but good growth has been improving matters, although there are skills shortages. Work and residence permits are available for most activities, but can be pricey.

The economy is dependent on tourism, fishing and financial services

The Government encourages tourism which pulls in around more than 1,000,000 visitors a year, and also encourages inward investment with incentives. Financial services developed rapidly in the 90s, and there are more than 20,000 offshore enterprises, mostly using the International Business (Exempt) Company form. The key offshore sectors are banking, insurance and trust management. The Islands have a popular yacht registry. There is a reasonable level of professional expertise on the Islands and costs are low by comparison with many jurisdictions.

There is almost no taxation

There are no income, capital, inheritance or general sales taxes (although a value-added tax will be introduced from 2013). Government revenue comes mainly from import duties, stamp duty and business licenses; there are some taxes on tourism. There are no tax treaties and the Islands' mutual assistance arrangements with other countries do not include fiscal crime.

In February, 2004, the government, under pressure from the UK, committed itself to implementing the European Union's Savings Tax Directive, subject to the creation of a level playing field on the issue for all offshore and onshore jurisdictions. The Directive came into effect on July 1, 2005.

Allegations of corruption in the Government in 2009 led to a suspension of ministerial government for an initial period of up to two years. The ensuing fiscal crisis led to a UK-funded financial rescue package and the introduction of new taxes as the authorities battle to balance the books by 2013.

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