International business leader David Ezekiel yesterday repeated his strong concerns at the payroll tax increases which got the backing of MPs on Monday night.

"We believe that these additional expenses are not good for Bermuda business, and therefore in the long run not good for job creation or retention on the Island," the Association of Bermuda International Companies (ABIC) chairman told The Royal Gazette.

He was speaking after the House of Assembly gave the go ahead to controversial legislation that raises payroll tax from 14 percent to 16 percent and increases the salary cap from $350,000 to $750,000.

During a contentious debate — in which the United Bermuda Party highlighted concerns from local and international business, the public and unions — Finance Minister Paula Cox said international business understands the increases are needed to make Bermuda a safer place to live, with a better public education system.

Yesterday, Mr. Ezekiel responded: "I was not in the House to hear the Minister's statement and therefore do not wish to react to it.

"All I can do is reiterate ABIC's position: we have voiced strong concerns at the two percentage points increase in the payroll tax and equally strong concerns at the quantum leap in the salary cap from $350,000 to $750,000 and our position has not changed.

"International business and the senior people in it have expressed our concerns relating to the importance of public education and security and would expect adequate funding in any Budget to take care of these issues.

"We have, however, expressed our opinion that the funding for these and other requirements should have come primarily from expense reductions in the cost of Government as opposed to coming from further tax increases on a sector that is already under cost pressures relative to competing domiciles."

He said ABIC stands by its press release issued a few days after Ms Cox announced the increases in her Budget statement, which warned international companies could end up outsourcing more jobs overseas.

"International business and its employees will bear the bulk of these tax increases as some other sectors of the economy receive varying levels of exemptions," said that statement.

"The 14 percent increase in payroll taxes and, in some cases, a tax increase of well in excess of 100 percent on the most senior job creators in the international business sector will only serve to make Bermuda and the companies located here less competitive in the global economy, and will undoubtedly have a negative impact on retaining our current business or expanding employment here."

It warned: "ABIC urges Government, as a matter of urgency, to institute measures to ensure that budget overruns will simply not be tolerated in the year ahead, or in the years to come.

"We further encourage Government to consider these measures within the framework of a closer and more transparent dialogue with ABIC and the other international business organisations in order to reassure international business that Bermuda remains a welcoming domicile of choice for those companies that are here and those that may be created here in the future."

Ms Cox said on Monday night: "They [international business] talk about issues that have a commonality for people of Bermuda ... they feel the ends justify the means. They see there's a reason why.

"It's not that money is going into some sieve. Far from it. The money is going to those issues that are relevant to residents of Bermuda.

"When you increase taxes, it's not because we want to have portraits of ourselves up here. It's not because we want to frolic. It's so we can make sure Bermuda is a safe place to live and anchor your business."