International Taxation of Low-Tax Transactions, 2nd Edition

High-Tax Jurisdictions

Preface

Australia
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Devices for Utilising Low-Tax Jurisdictions
 

Austria
Attitude of Fiscal Authorities 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Devices for Utilising Low-Tax Jurisdictions
 

Belgium
Transactions with Low-Tax Jurisdictions 
Absence of General Anti-Avoidance Disposition 
Anti-Avoidance Dispositions of the Income Tax Code 
Tax Treaties 
Treaty Shopping 
Vehicles for Using Low-Tax Jurisdictions
 

Canada
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Using Low-Tax Jurisdictions 
Conclusion
 

Finland
Introduction 
Tax Treaty Regime 
Treatment of Offshore Transactions
 

France
Introduction 
Low-Tax Jurisdictions 
Tax Treaty Regime 
Treaty Shopping 
Tax Haven Legislation
Tax Vehicles
 

Germany
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions
 

Greece
Introduction 
Attitude of Fiscal Authorities towards Transactions
with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions

Indonesia
Tax Regime
Double-Taxation Treaties 
Indonesian Source Jurisdiction 
Residence Jurisdiction
 

Italy
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Use of Tax Havens
 

Japan
Introduction 
Tax Treaty Regime 
Domestic Legislation with Regard to Low-Tax Transactions 
Transfer Pricing

Mexico
Attitude of Fiscal Authorities toward Transactions
Involving Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Off-shore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions
 

The Netherlands
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime
Treatment of Offshore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions

New Zealand
Introduction
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions
 

Norway
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Using Low-Tax Jurisdictions
 

Portugal
Transactions with Low-Tax Jurisdictions 
Permissible Devices for Utilising Low-Tax Jurisdictions
 

Romania
Introduction 
Attitude of Fiscal Authorities towards Transactions
Involving Low-Tax Jurisdictions 
Tax Treaty Regime
 

Spain
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Devices for Using Low-Tax Jurisdictions 
 

United Kingdom
Transactions with Low-Tax Jurisdictions 
Tax Treaty Regime 
Offshore Transactions 
Devices for Utilising Low-Tax Jurisdictions

United States
Transactions with Low-Tax Jurisdictions 
United States Patriot Act 
Tax Treaty Regime 
Treatment of Offshore Transactions 
Permissible Devices for Utilising Low-Tax Jurisdictions
 

Low-Tax Jurisdictions

Anguilla
Introduction 
Tax Regime
Impact of Tax Treaties 
Sourcing Income within Anguilla 
Establishing Residence within Anguilla 
Vehicles Available for Achieving Favourable Tax Status
 

Aruba
Introduction 
Aruba Tax Regime 
Advantages of Sourcing Income in Aruba 
Vehicles for Achieving Favourable Tax Status
Impact of Tax Treaties and Kingdom Tax Arrangement 
Establishing Residence and Presence in Aruba
 

The Bahamas
Introduction
Individuals 
Companies 
Partnerships 
Trusts 
Taxes
Special Business
 

Barbados
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Procedure for and Advantages of Sourcing Income 
Procedure for and Advantages of Establishing Residence
 

Belize
Introduction 
Tax Tools 
Banking 
Tax Regime and Classification as No-Tax Jurisdiction for Non-Residents 
Establishing Residence in Belize 
Domestic Taxes for Residents 
Vehicles Available for Achieving Favourable Tax Status
 

Bermuda
Tax Regime 
Impact of Tax Treaties 
Sourcing Income within Bermuda 
Establishing Residence within Bermuda 
Vehicles Available for Achieving Favourable Tax Status 
Conclusion
 

British Virgin Islands
Introduction 
Definitions 
Tax Regime and Classification as No Tax or Low Tax 
Stamp Duty 
Tax Treaties 
Sourcing Income within the British Virgin Islands 
Vehicles for Achieving Favourable Tax Status 
Conclusion
 

Cayman Islands
Introduction 
Banking 
Insurance 
Corporations and Companies 
Limited Partnerships 
Trusts 
Residence, Employment, and Carrying on Business
 

Costa Rica
Tax Regime and Classification as Low-Tax Jurisdiction
Impact of Tax Treaties 
Sourcing Income in Costa Rica 
Establishing Residence in Costa Rica 
Vehicles Available for Achieving Favourable Tax Status
 

Cyprus
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction
Impact of Tax Treaties 
Sourcing Income within Cyprus 
 

Dominica
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Procedure for and Advantages of Sourcing Income within Jurisdiction 
Caribbean Common Market
Procedure for and Advantages of Establishing
Residence within Jurisdiction 
Vehicles for Achieving Favourable Tax Status
 

Gibraltar - Reserved

Guernsey
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Tax Treaties 
Procedure for and Advantages of Sourcing Income
within the Jurisdiction 
Procedure for and Advantages of Establishing Residence
within the Jurisdiction 
Vehicles Available for Achieving Favourable Tax Status
 

Hong Kong
Introduction 
Tax Regime and Classification as a Low-Tax Jurisdiction 
Impact of Tax Treaties 
Profits Tax in Hong Kong 
Establishing Residence within Hong Kong
 

Ireland
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income within Ireland 
Establishing Residence within Ireland 
Vehicles for Achieving Favourable Tax Status
 

Jamaica
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income in Jamaica 
Establishing Residence in Jamaica 
Vehicles for Achieving Favourable Tax Status
 

Jersey
Tax Regime and Status as Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income within Jersey 
Establishing Residence within Jersey 
Vehicles Available for Achieving Favourable Tax Status
 

Jordan
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Non-Operating Foreign Companies 
Investment Promotion 
Jordan Industrial Estates Exemption 
Free Zones 
Aqaba Special Economic Area 
Qualifying Industrial Zones 
Estate Tax 
Double Taxation Treaties
 

Kuwait
Status as Low-Tax or No-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income within Kuwait 
Establishing Residence within Kuwait 
Incentives
 

Liechtenstein
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Forms of Taxation 
Impact of Tax Treaties 
Sourcing Income within Liechtenstein
Establishing Residence within Liechtenstein 
Vehicles Available for Achieving Favourable Tax Status 
Conclusion
 

Macao
Introduction
The Tax System
 

Malta
Introduction
Sourcing Income within the Jurisdiction 
Establishing Residence within the Jurisdiction 
European Union, European Economic Area, and Swiss Nationals
Non-European Union, European Economic Area, and Swiss
Nationals 
Double-Taxation Relief 
Vehicles Available for Achieving Favourable Tax Status 
Conclusion
 

Mauritius
Introduction 
Tax Regime 
Sourcing Income within Mauritius 
 

Monaco
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Sourcing Income in Monaco 
Establishing Residence in Monaco 
Vehicles for Achieving Tax-Favourable Status 
Conclusion
 

Netherlands Antilles
Classification of the Current Tax Regime and its Main Elements 
Impact of Double-Tax Treaties 
Procedure for and Advantages of Sourcing Income within the Jurisdiction 
Procedure for and Advantages of Establishing Residence within
the Jurisdiction 
Vehicles Available for Achieving Favourable Tax Status
 

Nevis
Introduction
Impact of Tax Treaties 
Sourcing Income within the Jurisdiction 
Establishing Residence within the Jurisdiction 
Vehicles Available for Achieving Favourable Tax Status

Oman
Tax Regime 
Procedure for Sourcing Income 
Establishing Residence in Oman
Vehicles Available for Achieving Favourable Tax Status
 

Panama
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Establishing Residence within Panama 
Vehicles Available for Achieving Favourable Tax Status
 

San Marino
Introduction
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income in San Marino 
Establishing Residence in San Marino 
Vehicles Available for Achieving Favourable Tax Status
 

Seychelles
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income in Seychelles 
Establishing Residence within Seychelles 
Vehicles Available for Achieving Favourable Tax Status
 

Singapore
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties
Sourcing Income within the Jurisdiction
Establishing Residence within the Jurisdiction 
Conclusion

Sri Lanka
Tax Regime and Classification as Non-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Procedure for and Advantages of Sourcing Income within Jurisdiction 
Procedure for and Advantages of Establishing Residence within the Jurisdiction 
Individuals 
Vehicles Available for Achieving Favorable Tax Status
 

St Vincent and The Grenadines
Introduction
Tax Regime 
Tax Treaties 
Offshore Centre
 

Switzerland
Introduction 
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income within Switzerland 
Establishing Residence within Switzerland 
Vehicles Available for Achieving Favourable Tax Status
 

Trinidad and Tobago
Introduction 
Impact of Tax Treaties 
Sourcing Income 
Establishing Residence 
Vehicles for Achieving Favourable Tax Status

Turks and Caicos Islands
Introduction 
Tax Regime and Classification as No-Tax Jurisdiction 
Impact of Tax Treaties 
Procedure for and Advantages of Sourcing Income 
Establishing Residence within the Jurisdiction 
Vehicles Available for Favourable Tax Status 
Conclusion
 

United Arab Emirates
Tax Regime and Classification as a No-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income in the United Arab Emirates 
Establishing Residence in the United Arab Emirates 
Vehicles Available for Achieving Favourable Tax Status 
 

Uruguay
Offshore Corporations
 

United States Virgin Islands
Tax Regime and Classification as No-Tax or Low-Tax Jurisdiction 
Impact of Tax Treaties 
Sourcing Income in the United States Virgin Islands 
Establishing Residence in the United States Virgin Islands
Vehicles Available for Achieving Favourable Tax Status
 

European Union
Introduction 
Direct Taxes 
Value-Added Taxes 
Capital Duty 
Transfer Pricing Convention 
Mutual Assistance Directive
Case Law 
Report on Harmful Tax Competition 
Electronic Commerce
 

Double-Taxation Treaties
Introduction 
Development of Double-Taxation Treaties 
The Commentary 
Types of Double-Taxation Agreements 
Inheritance Tax Double-Taxation Agreements 
Organisation for Economic Co-Operation Development Models

About the Editor:

Professor Dennis Campbell is the Director of the Center for International Legal Studies (CILS) in Salzburg, Austria, and teaches as an adjunct Professor at Suffolk University Law School. He is the former Director of International Programs and Professor of Law at University of the Pacific, McGeorge School of Law. He has lectured at Stockholm University, Helsinki University, Salzburg University, National University of Taiwan, Warsaw University, and Jagiellonian University. He is a member of the New York State Bar and the Iowa State Bar and is a former Assistant Secretary of the California State Senate.

The Center for International Legal Studies promotes the dissemination of information among members of the international legal community, through research and publication projects, post-graduate and professional training programs, and academic seminars, professional symposia and continuing legal education conferences. Nearly 5,000 lawyers worldwide have been designated as Fellows of the CENTER FOR INTERNATIONAL LEGAL STUDIES in recognition of their contributions to its programs. The Center provides observers on a regular basis at meetings of UNCITRAL and its Working Groups in Vienna and New York.

About the Contributors:

High-Tax Jurisdictions

Preface, Dale R Johnson, Manufacturers’ Services Ltd

Australia, Philip Diviny, Middletons

Austria, Friedrich Schwank, Law Offices Dr F Schwank

Belgium, Inès Wouters, Afschrift Association d’Avocats

Canada, Ross D Tunnicliffe, Clark, Wilson

Finland, Janne Juusela and Jonna Yli-Äyhö, Attorneys at Law Borenius Ltd.

France, Marylène Bonny-Grandil, Altexis

Germany, Hans-Jörg Wittmann, ADVISES Partnerschaft von Rechtsanwälten Wirtschaftsprüfern 

Greece, Christos Th Vardikos, Vardikos & Vardikos

Indonesia, P D D Dermawan, M Arie Armand, and Benny Handoko, DNC Advocates at Work

Italy, G Massimiliano Danusso and Laura Vicentini, Brosio, Casati & Associati

Japan, Masahiro Murashima, Kitahama Partners L.P.C.

Mexico, Luis E Meurinne M, Arias, Meurinne y Rodríguez, S.C.

The Netherlands, Peter Lier, KPMG Meijburg & Co

New Zealand, David Simcock, Bell Gully

Norway, Øystein A Sverre, Braekhus Dege

Portugal, Mariana Gouveia de Oliveira and Miguel Teixeira De Abreu, Abreu Advogados

Romania, Angela Rosca, Taxhouse - Taxand

Spain, Joan-Ramon Miquel Torrents and Fèlix Castells, Marti & Associats

United Kingdom, Richard C S Palmer, Ashurst

United States, Ansgar A. Simon, Shearman & Sterling LLP


Low-Tax Jurisdictions

Anguilla, Palmavon J Webster, Webster & Dyrud

Aruba, P John Tchong and Andin C G Bikker, Croes, Wever & Tchong

The Bahamas, Michael L Paton, Lennox Paton

Barbados, Andrew V Thornhill, George Walton Payne & Co

Belize, Steve Saemmler Klein and Boyd Reneau, Butterfield, Reimer & Associates

Bermuda, Wendell Hollis and Peter D Martin, Mello, Jones & Martin

British Virgin Islands, Valerie C Georges-Thomas, Lex Caribbean Law Offices

Cayman Islands, Michael L Alberga, Myers & Alberga

Costa Rica, Silvio Lacayo, Inversiones Basicas, SA

Cyprus, Andreas Neocleous and Philippos Aristotelous, Andreas Neocleous & Co

Dominica, Bernard Don McDonald Christopher, Don Christopher & Co

Guernsey, Mark A J Helyar, Financial Services Gray

Hong Kong, Shane F Weir, Weir & Associates

Ireland, Michael Ryan, McCann FitzGerald

Jamaica, Loreen A Walker, Nunes, Scholefield, DeLeon & Co

Jersey, Antony R Hillman, Crills

Jordan, Michael T Dabit, Michael T Dabit & Associates

Kuwait, Mishare Mohamed Al-Ghazali, The Law Offices of Mishare Al-Ghazali

Liechtenstein, Ernst J Walch, Walch & Schurti

Macao, Jorge Simão, Dr Jorge Simão & Associates

Malta, Stephan Balzan and Jonathan De Giovanni, EMD

Mauritius, Dev Joory, International Financial Services Limited

Monaco, William Easun, Lawrence Graham

Netherlands Antilles, Wendell Meriaan, KPMG Tax & Legal Services

Nevis, Mario M Novello, Trident Corporate Services, Inc

Oman, Mohammed Al Murtada Hamid, Al Alawi, Mansoor Jamal & Co

Panama, Alvaro Aguilar, Lombardi Aguilar & Garcia

San Marino, Maurizio Bastianelli, Studio Mancinelli

Seychelles, John Goldsworth, The Mill Office

Singapore, Loo Choon Chiaw, Loo & Partners

Sri Lanka, F J & G de Saram

St Vincent and The Grenadines, Margaret Hughes Ferrari, Hughes and Cummings Chambers

Switzerland, Denis Berdoz, Baker & McKenzie

Trinidad and Tobago, Mark James Morgan, Fitzwilliam, Stone, Furness-Smith & Morgan

Turks and Caicos Islands, Anne M Phelan, Finbar F Dempsey & Company

United Arab Emirates, Mark E Bisch, Sam E Eversman, and Richard T DeBelden, Al-Mehairi Legal Consultants in Association with Fulbright & Jaworski LLP

Uruguay, Juan Federico Fischer, Muxí & Asociados

United States Virgin Islands, William L Blum, Solomon Pearl Blum Heymann & Stich LLP

European Union, John H Graham, Graham, Smith & Partners

Double-Taxation Treaties, Stephen Pallister, Charles Russell LLP