What country of the world has lowest taxes?


3

What parts of the world have developed infrastructure, cheap fast internet, transportation, and cheap energy; and the lowest taxes as well?

Tax

asked Dec 9 '10 at 00:00
Blank
Psihodelia
137 points
  • Most parts of the world have "transportation". I mean, a mule is "transportation". What is "fast cheap internet"? What do you mean by "developed infrastructure"? As you might imagine, your question is highly lacking in definition and scoping. – Alphadogg 8 years ago
  • Not sure what this has to do with startups? – Steve 5 years ago

8 Answers


7

Tax policy is a lot more complex than simply finding a country with the "lowest tax rate". Multiple rates come into play, for corporate and personal income.

Dubai has zones that are 100% tax free. These zones include one for Internet ventures. As a US citizen it does not matter if you operate in a 100% tax free zone. All income earned, foreign and domestic is subject to US income tax. Failure to pay taxes or report foreign income is tax evasion.

There are ways around this. You could form an IBC in a country such as Panama that has strict privacy in place. But the issue arises that while you could earn money, and save it in Panama, you will have some serious explaining to do if you ever were caught not reporting the income and have a very hard time bringing it to the USA.

With recent political events in the USA the issue of taxes has come up yet again. While as a business owner you want to make sure you do take advantage of lower taxes whenever possible, there is a fine balance between tax avoidance and tax fraud.

My personal view on it is:
1. Taxes are good, they are actually great. If you are paying 1m in taxes, you are surely doing something right.

  1. You only pay taxes on your net income after expenses, therefore its the money that you have not reinvested into your business, or you have invested into something of value such as property, or hardware (which you can adjust in value over the years)
  2. We need to pay taxes. The bottom line, and why the economy is so poor is not because of a housing bubble, but the destruction of the middle class. Taxes help fund middle class jobs such as police, firemen, and teachers. They pave our roads, keep us secure. Although there is a ton of waste, money that says in your home country is good for you. That money goes to the middle class, and the middle class is needed to buy your products.

I apologize for my political rant, but I am weary of entrepreneurs who identify themselves as Republicans because they hate taxes. The truth is as a small business, your tax structure is a lot different than a multinational corporation. Further, just because you are an S Corp, C Corp or LLC, does not mean you are a Corporation as republicans frame it. You want to support those that support keeping jobs in your own country, and tax policy that grows the middle class. The middle class is your consumer base. You might not have Cops and School teachers subscribing to your SAAS product, but when they have money, they spend it, and it trickles up to your small business.

Don't spend too much time trying to figure out where to do business to "Avoid Taxes". Select where you want to do business on the overall cost to do business there, quality of life if you have to live there, and most of all the type of talent and employees you can attract.

answered Dec 9 '10 at 05:47
Blank
Frank
2,079 points
  • Taxes are good if you pay them in a peaceful country. If you are paying 1m in taxes to support killing and suffering of innocent victims, you are surely doing something wrong. – Psihodelia 8 years ago
  • Booo. You're not answering his question. – Jpartogi 8 years ago

3

There was a Mixergy interview with Mark Brooks where Mark spoke about why he based his business in Malta. According to Mark the tax rate is below 1% and it's a great place to live and start a business.

answered Dec 9 '10 at 07:18
Blank
Karl Krantz
334 points

3

I believe Somalia has the lowest taxes. Hardly anybody has any money, and there are no government services. There really isn't much of a Government to speak of.

answered Feb 17 '12 at 04:10
Blank
Frank J Barbo
31 points

2

Since you're not providing a context in how this relates to your startup, perhaps this is a question best suited for Quora or possibly by Googling some. If you did, you'd turn up with this: http://en.wikipedia.org/wiki/Tax_haven

answered Dec 9 '10 at 03:14
Blank
John Sjölander
2,082 points
  • Can you please invite me to Quora? It seems I need an invitation from some member. – Psihodelia 8 years ago

2

I would say Hong Kong, 16.5% for corporate tax. It also has one of the fastest broadband in the world.

Singapore is also on the lookout, 17% corporate tax for profits above 300K and ~8% for profits under 300K. Internet speed is also comparable to HK. It also has good friggin awesome fast railway and bus line.

answered May 26 '11 at 21:18
Blank
Jpartogi
1,342 points

-1

Canada has very low taxes when you consider how much you get in the way of social services.

answered Dec 9 '10 at 08:17
Blank
Frank
2,079 points

0

I hope you are not going to base your business decision solely on that. There are many parts of the world where businesses do not pay "official" taxes but that does not mean they do not have to pay off... Very often, the saying is true: "You get what you pay for". If you have to pay taxes and as a result enjoy, security, legal protection as well as many other business benefits -- consider it a business expense.

Good luck!

answered Dec 9 '10 at 00:27
Blank
Usabilitest
1,698 points

0

It seems fairly popular to incorporate on the Isle of Man for tax reasons.

answered Feb 17 '12 at 13:39
Blank
Dustin Kirkland
101 points

Your Answer

  • Bold
  • Italic
  • • Bullets
  • 1. Numbers
  • Quote
Not the answer you're looking for? Ask your own question or browse other questions in these topics:

Tax