Argentina: The highest income tax rate in Argentina is 35%, and the country`s high indirect tax rate is 21%. However, the share of taxes in GDP is only 8.04%. As one of Latin America`s largest economies, Argentina depends primarily on its abundant energy and agricultural resources. Nevertheless, the economy is currently working to get out of crisis mode. Monaco is a city-state not much bigger than the Vatican. It has one of the lowest crime rates of any country in the world. One downside, however, is that Monaco is also one of the most expensive places in the world to live. Access to Monaco`s tax-free financial environment is fast, but not cheap. A legal residence permit can be obtained in less than three months, but requires the deposit of at least 500,000 euros in a bank in Monaco. Lesotho is a landlocked African country that goes under the radar of many tourists, despite being surrounded by the eternal tourism heavyweight, South Africa. Perhaps because there is no significant influx of tourist dollars, Lesotho is one of the most taxed countries in the world. Although the World Bank does not provide data on income tax rates in the country, the total contribution of taxes to the country`s GDP is staggering 31.57%.
Holding companies are not required to pay corporation tax on capital gains and dividends received from non-resident companies. Maltese citizens are exempt from paying taxes on foreign capital gains, even if the income goes to Malta and is not imported into the country. Comoros has the highest corporate tax rate in the world at 50%. Puerto Rico follows with 37.5% and Suriname with 36%. Excluding jurisdictions with 0% corporate tax rates, the countries with the lowest corporate tax rates are Barbados with 5.5%, Uzbekistan with 7.5% and Turkmenistan with 8%. Fifteen countries do not have a general corporate tax. These countries are Anguilla, Bahamas, Bahrain, Bermuda, British Virgin Islands, Cayman Islands, Guernsey, Isle of Man, Jersey, Saint Barthelemy, Turks and Caicos Islands, United Arab Emirates, Vanuatu and Wallis and Futuna. Tax Rate: 25% Price for a can of Coca-Cola: US$1.00 Quality of life: If Bermuda or the Bahamas are out of your budget, then Belize can be the tropical playground you can call home. With about two-thirds of the cost of living of the aforementioned B-locals, Belize is one of the cheapest resorts in the Caribbean considered a tax haven.
For starters, taxes are low. Income tax is capped at 25 per cent for individuals and businesses, with the first $10,000 exempt. There are also no capital gains taxes and property taxes are estimated at 1-1.5% of the country. Dividends from a Belize International Business Corporation – any offshore company that does not contain U.S. income – are exempt from tax. There is also no inheritance tax. Methodology: GOBankingRates assessed the most and least tax-friendly countries using the latest available World Bank data on tax revenues as a percentage of GDP. The most tax-friendly countries are those with the lowest tax revenues relative to GDP and the least tax-friendly are those with the highest tax revenues. Countries with the latest available data from 2017 or earlier, countries with fewer than 500,000 inhabitants, and countries currently experiencing unrest or wars that may affect reporting have been excluded from the list.
For additional data, GOBankingRates also provided the highest 2020 tax rate in each country for KPMG`s personal income tax, indirect taxes, and social security contributions. All data were collected and updated on January 5, 2021. It may be hard for U.S. taxpayers to believe, but the U.S. is on the list of the most tax-friendly countries. According to the World Bank, the United States is actually one of the countries that pays the lowest share of its GDP in taxes. Here`s a look at the U.S. counterparts on the list of countries with the lowest taxes when analyzed as a percentage of GDP. The Kingdom of Bahrain is a country in the Persian Gulf alongside the neighboring countries of Qatar and the United Arab Emirates. Most importantly, it has no taxes on income, sales, capital gains, corporations or estates, except to make profits from the country`s fossil fuels.
For companies that engage in this path, a tax rate of 46% is levied on the net profit, whether domestic or foreign. Apart from that, the positive aspects make Bahrain one of the most popular countries when it comes to tax minimization. Another attractive feature is the fact that Bahrain is one of the most liberal Gulf states in the world, with friendly locals taking pride in their culture. Almost all Bahrainis also speak English. The only real downside is that expats may experience island fever on the island nation. Beach developments have begun to emerge on Muharraq Island for those looking for a little more of a lifestyle bonus. There are many ways to grow your wealth, legally reduce your taxes, and buy a home to live in some of the safest countries in the world. Nomad Capitalist is here to guide you through it all.
The answer to the functioning of countries with the lowest income taxes in the world is not rocket science; It depends on other sources of income.