LiveOffshore - Liberty, Financial Privacy, and Economic Freedom

TAX HAVENS

A Tax Haven or Offshore Financial Center is a sovereign jurisdiction whose government has proactively designed its tax, privacy, regulatory and banking laws to create a favorable low-cost business environment to compete in the global economy.

Countries that aspire to be tax havens:

• Are generally smaller (most have fewer than one million people),
• Have a higher GDP, and
• Are better governed.

Tax havens are marked by a strong governance structure that includes:

• The rule of law,
• Increased government transparency,
• Reduced corruption,
• Political stability.

Poorly governed countries generally have difficulty attracting large amounts of foreign investment despite significantly reduced tax rates. So better governed countries are more likely than others to become tax havens.

The business environment of tax havens is often marked by:

• Low or zero taxation on investments.
• Their financial services sector are generally more robust and better developed when compared to other sectors of the economy.
• The regulatory climate is designed to favor business.
• The business services are predominately geared towards nonresidents.
• Asset protection vehicles reduce or eliminate inheritance taxes.
• Protection against expropriation.
• Asset holding entities in which to isolate high-risk assets.
• Special purpose entities designed to keep liabilities offshore.

VIDEOS

• The Moral Case for Tax Havens
• The Economic Case for Tax Havens
• Tax Havens:  Myths Versus Facts