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Generally speaking,
Australia is not considered an advantageous
location for those interested in tax
minimization, and has a comprehensive
taxation system in place. Residency
is assumed if an individual has his
permanent home there, if it is his
habitual abode, if he has close economic
ties, or has been in Australia either
continuously or intermittently for
more than 183 days in any tax year.
Residents
are taxed on their world-wide income;
there are a considerable number of
tax treaties, and tax paid on foreign
income is normally allowed as a credit
against Australian tax. However, foreign
'passive' income (ie dividends, interest,
royalties etc) is treated as a separate
class of income, and tax credits are
segregated according to class. Depending
on individual circumstances, it may
therefore be best for an Australian
tax-resident to make sure that any
money placed on deposit abroad is
not taxed at origin.
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Vanuatu
| More
than 100 exempted banks were registered
in Vanuatu in 2002, making it the
leading offshore banking centre in
the Eastern hemisphere; only a few
banks provide services locally, including
ANZ, Westpac, the National Bank of
Vanuatu, and the Bank of Hawaii. The
Asian Development Bank has its Pacific
regional office in Port Vila. The
new 2002 Banking Act however led to
a considerable reduction in the number
of licensed banks - by mid 2005, only
four domestic banks and six international
banks remained. In the two years prior
to this, 28 banks had departed or
been closed down.
Exempted
banks offer deposit and other asset
management services, but do not offer
chequeing accounts - for that, one
must go to a 'local' bank with a full
banking license. A few international
banks have such licenses, including
several major Australian banks.
There
are no taxes in Vanuatu on profits,
dividends or income for either resident
or non-resident individuals.
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Hong
Kong
Hong Kong is one of the foremost
international banking centres in the world, with about 70 of
the largest banks having established a presence there. In August,
2010, there were 146 licensed banks, 22 restricted licence banks
and 27 deposit-taking companies in business. In addition, there
are 70 local representative offices of overseas banks in Hong
Kong.
There is a 3 tier system of banking
institutions in place; licensed banks,
restricted licensed banks, and deposit
taking companies. Hong Kong has no central
bank as such, but the HKMA does assume
many of the responsibilities typically
assigned to a central bank, including
ensuring the safety and soundness of
the banking system and the stability
of the currency. Hong Kong adheres to
the Basle principles for bank supervision.
Under the Sino-British Joint Declaration
on the Future of Hong Kong, Chinese
authorities were committed to enact
the Basic Law of the Hong Kong Special
Administrative Region. The Basic Law
is the legal basis for the "One
Country, Two System" guarantee,
and has provided for the continuance
of Hong Kong’s system of common
law and free market economic system
after 1 July 1997.
The Law stipulates that the Hong Kong
dollar will remain freely convertible;
that markets for foreign exchange, securities,
futures, and other financial products
will remain open; and that no controls
will be placed on the flow of capital
into or out of Hong Kong.
Although it is considered by some to
be an offshore jurisdiction, Hong Kong
is better described as a low tax area,
which levies tax according to the territorial
principle. Personal income tax is known
as Salaries Tax, and individuals, whether
resident or not, are taxed only on income
'arising in or derived from a Hong Kong
employment'. Thus, non-employment source
income such as bank interest and share
dividends is not taxable in the territory
either for residents or non-residents.
Hong Kong banks evidently offer a world-class
array of financial services of all types.
Deposits can be made in many different
currencies, but as might be expected
deposit rates may be most attractive
in widely-used local or global currencies.
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