It looks the UK really means business. They are not going to allow some small tax haven whose government is on the verge of not being able to pay its employees to dictate terms. The Queen has the leverage and the cash and she is letting the Caymans know it. The month long bickering focused around the conditions for giving the Cayman Islands a £38m emergency bailout has finally come to a head. Painful cuts and sacrifices are going to be required to avoid paying government employees in high fives and compliments. An agreement has almost been reached and the Caymans may never be the same because of it.
The deal means the island will not have to introduce either a property tax or payroll tax this year but it will have to increase import duty on "non-essential watercraft" and other luxury goods as well as increasing bank transaction fees, overseas financial transfers and work permits.
Cayman Islands told to raise taxes or lose UK bailout [Guardian.co.uk]