Tax Havens Require Political and Economic Stability to Flourish
Without political and economic stability, no amount of tax inducement can bring in outside investors. No company or individual, whether local or international, will feel comfortable making any kind of capital investment in any country where the political climate is characterised by upheavals and a lot of uncertainty. African instability itself explains why Africa still lags far behind other parts of the world in terms of economic development and the inward flow of investment funds.
In contrast, the political and economic stability of tax havens like Switzerland are a magnet for huge capital inflows. This is illustrated by the fact that since 2015 the Swiss Central Bank’s highest interest rate on deposits is -0.25 percent. The bank is charging depositors a fee for holding their money (investors are paying a fee for safety).
Similar posts you may like
- Living in a Tax Haven
The tax systems of most OECD and developed countries are very similar. Generally, individuals who are deemed to reside in their country will be Read more
- Tax Savings Strategy 203 | Granny Flats
A granny flat is a self-contained secondary dwelling built on a residential property. Granny flats must be self-contained with their own kitchen, bathroom, and Read more
- Locating Holding Companies
Locating a holding company in a tax haven can be used to bring together investors from various countries who are investing in businesses that Read more
- Offshore Trusts
Trusts involve a settlor transferring (or ‘settling’) assets (i.e. the ‘trust property’) on the trustees. The trustees manage the assets for the benefit Read more
"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2