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Lowtax
Network Content Update | Issue XXVII | 6 March 2008 |
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Dear Colleague, This week:
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Offshore
Grenada is the largest of a group of Caribbean islands, north of Trinidad and Tobago. It is volcanic in origin, with central mountains; there are extensive, sandy beaches, and many reefs. The climate is tropical, tempered by northeast trade winds. Grenada is on the southern edge of the hurricane belt, but the occasional hurricanes can be devastating. After Hurricane Janet in 1955, with winds of 115 mph, came Hurricane Ivan in 2004 and Hurricane Emily in 2005, both of which caused serious damage. A French colony was established on Grenada in the 17th century, but eventually the island was ceded to the British under the Treaty of Versailles in 1783. The British imported African slaves and established sugar plantations, which were staffed by indentured Indian immigrants after the abolition of slavery. The island gained independence in 1974. Despite its British history, the island retains many French cultural influences. The population of 89,703 (July 2006 est.) has English as its official language. Grenada has a constitutional monarchy with a Westminster-style parliament. The Queen is the Head of State, represented by a governor-general. Although the island is famous for its nutmegs, Grenada now relies on tourism as its main source of foreign exchange; the development of an offshore financial industry has also contributed to growth in national output. The island is recovering quickly from the hurricanes of 200/5. The currency is the East Caribbean dollar. Foreign investment is welcomed, but there are some restricted sectors of the economy. Domestic companies are taxed on their profits, but the offshore sector is largely free of taxation; and investors once accepted are given good fiscal incentive packages. The offshore sector offers International Business Companies, Banking, Insurance and Gaming regimes. Learn more in our full Grenada Knowledgebase. |
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Offshore
Malta Wanted To Be In The EU . . . most of the time, anyway Malta is an independent nation, having split from the UK in 1964. The Maltese Islands are 100 km south of Sicily, with a population of 400,000; the climate is warm. Malta has a Westminster-style democracy, but has been politically fractious since independence. 15 years of post-colonial adolescent flirtation with Communism and the third world has however been succeeded by a more mature attitude. Malta joined the EU in 2004, although as late as the spring of 2002, with EU accession negotiations almost completed, the opposition labour party was still hankering after a life as the 'Switzerland of the Mediterranean'. Eventually, Malta was invited to join the EU in December, 2002, along with Cyprus and 8 Eastern European ex-Soviet states. A referendum in March, 2003, approved EU entry, and after the government was returned to power in April, it signed the EU accession treaty in Athens. Finally, the Maltese Parliament ratified the accession treaty in July, 2003. The official languages are English and Maltese. The British military and naval base once dominated Malta but since 1979, when the British left, the excellent port facilities have not yet been fully re-utilised. Tourism has become a major contributor to the economy, particularly visits by cruise ships. The airport has good connections with a wide range of European countries. GDP per head of $21,300 is low on the European scale and increases only slowly; inflation is at 3.4%; unemployment at 3.9% has fallen from much higher levels. As a politically-stable, English-speaking retirement destination, Malta has experienced a real estate boom, especially since joining the EU, and adoption of the euro as from 1st January 2008 can only intensify a spiral of increasing prices which has led to some of the highest property values in Europe. . . . but its long-term economic future is dependent on financial services. Almost entirely lacking energy or other natural resources, and with a severe shortage of arable land, Malta is inevitably an import-hungry country. In the last 15 years, the Government has tried hard, and with some success, to create a high-technology manufacturing sector and to establish processing and distribution facilities around its rapidly growing Freeport. There are extensive investment incentives. Manufacturing, tourism and shipping go some way towards paying for imports, but the gap cannot be closed without the development of a financial services sector. Maltese legislation for banking, mutual funds, insurance and trust services was relatively late in arriving, and while these sectors are growing, they are not on the scale of some other OIFCs. Malta has moderately high internal taxes, but offers low-tax regimes to companies and individuals. Malta phased out its 'designer tax' Offshore Companies, which the EU would never have accepted, and in 2006 had to give in to the EU by legislating away their replacements, the International Trading Companies. As a result there will have to be changes to the general tax regime. There is a reasonably sophisticated business and professional infrastructure. Business sectors with offshore activity include banking, investment fund management (there is a stock exchange with a growing array of mutual fund listings), trust management, shipping (a particularly strong sector) and investment holding. Malta may be home to a World Trade Centre as its application for membership of the World Trade Centres Association (WTCA) was accepted in March 2001. World Trade Centres provide crucial support services to international businesses such as temporary office accommodation, secretarial and translation services, corporate training, meeting and exhibition facilities. The government has stated that it sees the establishment of a World Trade Centre as 'an additional and very important step in the promotion and development of Malta as a principal hub for trade in the Mediterranean region.' Learn more in our full Malta Knowledgebase. |
