Tax Havens: What They Are and Where They Are
A view of Panama's coastal belt
Tax havens are jurisdictions with preferential tax rates that allow for a reduction in tax burdens deemed by the OECD to be unfair in terms of competition compared to high-tax OECD countries. Tax havens have streamlined and highly liberal legislation that provides for:
- Territorial Taxation
- Tax residency for individuals and businesses
- Corporate secrecy or Corporate veil
- Banking secrecy under certain conditions to be verified
Tax Havens: What They Are and Residency Rules
Tax havens are also countries where establishing tax residency raises the specter of a reverse burden of proof on the individual who establishes residence in that tax haven. For example, Dubai and Panama are countries subject to the reverse burden of proof. This applies as long as you register with AIRE. Without AIRE registration, no one would know you reside in these countries, but you would not be able to benefit from AIRE registration and therefore from the cancellation of any obligations to the Italian tax authorities. AIRE, in fact, allows you to say goodbye to Italian tax obligations, and therefore we always encourage you to register with AIRE in the country where you establish residence, provided you actually live there. Tax havens are therefore subject to more humane and balanced laws, because they offer the right compromise between cost and efficiency for maintaining companies, accounts, and accounting management. Tax havens are present everywhere in the world. In the Americas, the tax havens of Panama, Uruguay, Paraguay, Belize, Cayman Islands, Bermudas, the Bahamas, and Delaware are famous. Tax havens exist in Europe, as do tax havens in Oceania and Asia. Tax havens have different laws depending on the country and geographic area. The procedures for doing business in tax havens vary greatly, ranging from stringent due diligence in some tax havens to more streamlined procedures in others. What is certain is that all tax havens comply with the law and are required to identify the final customer/beneficiary much more diligently than any European country. The reason why tax havens must proceed with proper identification is because they are subject to scrutiny by the IMF, FATF, FINCEN, and OECD, and a single error in their identification procedures leads to the exclusion of their banking system from international circuits or sanctions for international clients who do business with companies incorporated in sanctioned tax havens. Therefore, it is important to understand that tax havens are not countries where it is even remotely possible to violate the identification and due diligence rules. Tax havens are very strict in this regard and always apply the law to the letter. Tax havens benefit anyone who wishes to legally pay lower taxes by undergoing the due diligence that individual countries apply to international clients, always in compliance with international laws. Tax havens have not accepted hardened tax evaders or those who deal illegally in cash for at least 20 years. These are things of the distant past in these highly technological countries with fully digitalized finances. The general cleanup of tax havens benefits the tax havens themselves, allowing them to access an infinitely larger and richer market of honest clients to legally offer excellent services without having to accept entities deemed unsuitable for these types of services, thus allowing them to count on the opening of the corporate and banking markets to clients from countries that were previously difficult to access.
Generally speaking, any country that allows you to reduce the tax burden compared to your country of origin is classified as a tax haven. Within the OECD itself, due to some legal loophole, countries such as Andorra, Liechtenstein, Luxembourg, the Netherlands, Austria, Malta, Belgium, Cyprus, and Switzerland coexist, all of which are tax havens.
Tax havens are countries that are freely accessible and where you can do business freely.