Definition of Tax haven:
Generic term for a geographical area outside the jurisdiction of ones home country which imposes only a few restrictions on legitimate business-activities within its jurisdiction, and little or no income tax. Offshore havens generally provide international banking and financial services, and promise privacy of deposits and earnings. In effect, however, almost every country (in one way or the other) is a tax haven for non-nationals because it wants to attract foreign capital by offering incentives. Also called low tax jurisdiction, non tax jurisdiction, or offshore haven. See also offshore financial center (OFC).
In some cases, intranational locations may also be identified as tax havens if they have special tax laws. For example, in the United States, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming require no state income tax.
A tax haven is generally an offshore country that offers foreign individuals and businesses little or no tax liability in a politically and economically static environment. Tax havens also share limited or no financial information with foreign tax authorities. Tax havens do not typically require residency or business presence for individuals and businesses to benefit from their tax policies.
How to use Tax haven in a sentence?
- Tax havens provide the advantage of little or no tax liability.
- Offshore countries with little or no tax liabilities for foreign individuals and businesses are generally some of the most popular tax havens.
- Investors and businesses may be able to lower their taxes by taking advantage of tax-advantaged opportunities offered by tax havens however entities should ensure they are compliant with all relevant tax laws.
Meaning of Tax haven & Tax haven Definition