Tax Neutrality
Tax Neutrality is a driving force for global economic growth. It spurs innovation. It propels progress. It fosters opportunities.
Yet many people misunderstand Tax Neutrality. Some do not know what it means. Others mistakenly conflate it with tax havens or financial secrecy.
Let’s clear the air around Tax Neutrality. Let’s help countries, organizations, and individuals experience its benefits.
Tax Neutrality is not about darkness or financial secrets. It’s not the same as tax avoidance, and Tax Neutral jurisdictions are not tax havens. Tax Neutrality is about high standards, transparency, empowerment, security, efficiency, simplicity, and fairness.
A Tax Neutral jurisdiction does not add an extra layer of tax on top of what investors and companies owe in their own jurisdictions in compliance with their domestic tax rules. Tax Neutral jurisdictions can be countries or states. They are similar to countries with tax treaties, but have less complexity and provide equal tax treatment to all countries.
Investors can securely and transparently pool capital in Tax Neutral jurisdictions and pursue investment opportunities that drive economic growth, create jobs, and generate tax revenue in countries around the world.
Tax Neutral simply means the jurisdiction in which funds are domiciled does not impose additional taxes beyond those investors and companies are already paying to their own jurisdictions. Unlike tax havens, Tax Neutral jurisdictions adhere to legal standards and are committed to transparency.
Tax Neutral jurisdictions are committed to high standards and maintain advanced judicial systems to ensure both transparency and asset security. Instead of secrecy and obfuscation, they provide financial stability and security.
Unlike areas that rely on complex double taxation treaties, Tax Neutral jurisdictions feature simple tax models and the same stated and applied tax rates to prevent double taxation while doing no harm to other countries’ tax bases.
Tax Neutral jurisdictions support the pooling of international capital that can be directed to investment opportunities like infrastructure, business expansion and R&D spending. Those investments drive economic growth and job creation in the jurisdictions receiving the investment which increases their tax base while causing no tax harm.
Tax Neutral jurisdictions encourage industry/government collaboration. They openly collaborate with international tax and law enforcement agencies as well as global regulatory bodies to ensure adherence to international standards and laws.
Tax Neutral jurisdictions are committed to openness and embrace globally-accepted standards for transparency and exchange of information. They proactively engage in cross-border cooperation with law enforcement, making them attractive for investors–and unattractive for tax evaders.
Organizations can be certain they will pay no additional taxes in a Tax Neutral jurisdiction beyond what they pay in their home jurisdictions. Tax Neutral jurisdictions also impose the same stated and applied tax rates, providing fairness and certainty to investors.
Tax Neutral jurisdictions are just that–neutral. They do not prevent other countries from imposing the taxes they see fit on their citizens and businesses and therefore Tax Neutral jurisdictions pose no tax harm to other countries’ tax bases.
Unlike tax havens, which deprive countries’ ability to grow and cause financial instability, Tax Neutral jurisdictions benefit local economies and real people. They drive economic development, innovation, and pension fund growth around the world.
Tax Neutrality is defined by a “provide benefits and do no harm” approach that offers advantages to countries, businesses, and people around the world. Tax Neutrality positively impacts both developed and developing countries and, by its definition, does not cause tax harm to other countries because it does not affect other countries’ taxing rights.
Stated and effective tax rates are the same.
Does not add an extra layer of taxes to transactions.
Combats tax evasion with legislation, regulation, and automatic tax information sharing arrangements that uphold the highest international standards for transparency and cross-border cooperation.
Poses no risk for aggressive tax avoidance as it does not have tax treaties that provide opportunities for abuse or misuse.
Meets OECD economic substance requirements and therefore poses no risk of unfair tax competition.
Alleviates double taxation on:
Cross-border transactions. Taxing rights are automatically allocated to the other country, which is free to apply its domestic tax policy on cross-border transactions.
Retained profits in a subsidiary. Taxing rights are automatically allocated to the parent entity jurisdiction, which is then free to apply its domestic tax policy — including controlled foreign corporation rules — on the parent entity relating to the subsidiary’s retained profits.
Generally raises revenue through consumption taxes to fund government services and programmes.
Many countries suffer from a lack of advanced judicial systems, or have systems that are not impartial, which keep them from receiving investments. Tax Neutral territories feature impartial judicial systems that adhere to high legal standards, ensuring fair, legal, and secure investment opportunities.
Tax Neutral jurisdictions have teams of experienced and committed individuals with world-class infrastructure and resources to serve organizations with honesty, clarity, and professionalism.
Secure property rights are critical to global economic development. In Tax Neutral jurisdictions, laws are clearly defined and enforced, ensuring secure and trusted ownership that protects owners while supporting worldwide economic growth.
Unlike tax havens, Tax Neutral jurisdictions do not broker in secrecy. Tax Neutral jurisdictions are committed to upholding the highest international standards for transparency and maintain high levels of oversight and good governance over transactions. They adhere to global tax disclosure standards and work closely with regulatory bodies to ensure compliance with international laws.
Tax Neutrality is a driver of advanced innovation, economic growth, and financial stability at the global, local, and individual levels.
Money goes where it’s most needed, especially to developing countries that may have difficulties accessing capital due to a weak supporting infrastructure or other challenges. Small countries with limited diversification options can raise revenue through consumption taxes, worker visas, and other methods.
Areas that may not normally receive investments due to lack of a strong judicial system or other obstacles can receive the funding they may otherwise not be able to access. Technology, construction, farming, renewable energies, tourism, financial, and other industries benefit, helping local economies prosper, creating jobs and increasing tax revenue.
Individuals become financially empowered. Tax Neutrality bolsters pension plans and investments, helping people secure their retirements, pay for their children’s college educations, and more.
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