Tax Haven
Any country whose laws, regulations, traditions, and, in some cases, treaty arrangements make it possible for one to reduce their overall tax burden. These countries seek to encourage investment and make up revenue losses by charging a variety of fees for the start up of the entity and on an annual basis.
The term is normally used to refer to a jurisdiction where:
- There are no relevant taxes.
Or
- Taxes are levied only on internal taxable events, but not at all, or at low tax rates, on profits from foreign sources.
Or
- Special tax privileges are granted to certain types of taxable persons or events. Such special tax privileges may be accorded by the domestic internal tax system or may derive from a combination of domestic and treaty provisions.
The tax havens of the world broadly may be classified into six separate categories.
1. No-Tax Havens
- Anguilla
- Bahamas
- Bermuda
- Cayman Islands
- Nevis
- Turks and Caicos
- St. Vincent
- Vanuatu
2. Countries Taxing Only Local Income
- Costa Rica
- Gibraltar
- Hong Kong
- Liberia
- Panama
3. Low-Tax Havens with Treaty Benefits
- British Virgin Islands
- Luxembourg
- The Netherlands
- The Netherlands Antilles
- Singapore
4. Countries Offering Special Privileges
- Channel Islands
- The Isle of Man
5. Tax Havens for Individuals
- Andorra
- Campione d'Italia
- Monaco
- Sark
6. Tax Havens for International Business Companies
- Antigua
- Barbados
- Grenada
- Jamaica
- Montserrat
