Tax Heaven & Tax Heaven Countries
A country is usually an offshore country that gives foreign individuals and businesses little or no liabilities during a politically and economically static environment. Tax Heavens also share limited or no financial information with foreign tax authorities. Tax Heavens don’t typically require residency or business presence for people and businesses to profit from their tax policies. In some cases, international locations can also be identified as Tax Heavens if they need special tax laws. For instance, within the US, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming require no state tax.
Tax Heaven Countries
A list of some of the most popular Tax Heaven countries includes Andorra, the Bahamas, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, the Channel Islands, the Cook Islands, Hong Kong, The Isle of Man, Mauritius, Lichtenstein, Monaco, Panama, St. Kitts, and Nevis. A Tax Heaven is simply a country that offers individuals or businesses little or no tax liability. The Caribbean offers some of the most popular Tax Heavens in the world, providing benefits such as very low tax liability and financial privacy. Among the most used Caribbean Tax Heavens are the Bahamas, Panama, and the Cayman Islands.
Many of the Caribbean Tax Heavens are what are known as pure Tax Heavens, in that they impose no taxes at all. A number of Caribbean nations were motivated to become Tax Heavens so they could reduce dependence on foreign countries and maintain their own economies.
Breaking down Tax Heaven
Offshore Tax Heavens benefit from the capital their countries draw into the economy. Funds can flow in from individuals and businesses with accounts set up at banks, financial institutions, and other investment vehicles. Individuals and corporations can potentially benefit from low or no taxes charged on income in foreign countries where loopholes, credits, or other special tax considerations may be allowed.
A list of some of the most popular Tax Heaven countries includes Andorra, the Bahamas, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, the Channel Islands, the Cook Islands, Hong Kong, The Isle of Man, Mauritius, Lichtenstein, Monaco, Panama, St. Kitts, and Nevis. Worldwide there is not a comprehensively defined standard for the classification of a Tax Heaven country. However, there are several regulatory bodies that monitor Tax Heaven countries, including the Organization of Economic Cooperation and Development (OECD) and the U.S. Government Accountability Office. Characteristics of Tax Heaven countries generally include no or low-income taxes, minimal reporting of information, lack of transparency obligations, lack of local presence requirements, and marketing of Tax Heaven vehicles.