The 10 Best Corporate Tax Havens In The World

ireland

Photo: James Jordan on flickr

What’s the secret to the Irish miracle, which Dublin fought and unbelievably managed to preserve in the bailout? Low corporate tax rates.Ireland is a tax haven. On the PricewaterhouseCooper list of tax-friendly nations, it ranks seventh, right between Saudi Arabia and Oman.

EU compatriots Germany and France rank all the way down at 128 and 163 — so you can see why they would might want a change.

PwC’s ranking is based on total tax rate, number of tax payments, and time taken to comply, for small and medium-sized companies.

First, here's the USA -- #62

Corporate tax rate: 46.8%, including a 27.6% profit tax, 10% labour tax and 9.2% in other taxes.

Time to comply: 187 hours

Number of payments: 11

America's tax reforms have made it harder for businesses to pay taxes. The report highlights higher taxes for companies in and around New York City.

Source: PWC

#10 Canada

Total Tax Rate: 29.2%, including a 9.8% profit tax, 12.6% labour tax and 6.8% in other taxes.

Time to comply: 131 hours

Tax payments: 8

Canada lowered its business taxes to 29.2% and is putting into place practices that allow for increased efficiency in filing taxes. These include updating online payment systems and allowing businesses to file one corporate tax return. It also intends on incorporating a tax consolidation scheme which would make it easier for companies to identify and report tax losses within its subsidiaries.

Source: PWC

#9 Kuwait

Total Tax Rate: 15.5%, including a 4.8% profit tax and 10.7% labour tax.

Time to comply: 118 hours

Tax payments: 15

Member nations of the Gulf Cooperation Council (GCC) make paying taxes easier but often discriminate between businesses owned by GCC nationals and foreigners, only taxing the latter. Countries like Kuwait are said to be considering tax reforms.

Source: PWC

#8 Oman

Total Tax Rate: 21.6%, including a 9.7% profit tax, 11.8% labour tax and 0.1% in other taxes.

Time to comply: 62 hours

Tax payments: 14

As of January 2010, foreign companies that were earlier subjected to corporate tax rates capped at 30% are being taxed at an upper limit of 12%; the rate at which Oman's domestic companies are taxed.

Source: PWC

#7 Ireland

Total Tax Rate: 26.5%, including a 11.9% profit tax, 11.6% labour tax and 3% in other taxes.

Time to comply: 76 hours

Tax payments: 9

Ireland's low corporate taxes have brought an influx of foreign investment and business over the years and it's worried that a hike in taxes would drive away jobs after the crisis lifts. Its austerity plan revealed no changes in corporate tax structure, a move which is likely to see Ireland receive flak from the EU's taxpayers.

Source: PWC

#6 Saudi Arabia

Total Tax Rate: 14.5%, including a 2.1% profit tax and 12.4% labour tax.

Time to comply: 79 hours

Tax payments: 14

Rich in other resources like gold, coal, uranium and oil, Saudi Arabia doesn't rely on corporate taxes as a primary source of revenue.

Source: PWC

#5 U.A.E.

Total Tax Rate: 14.1%. This is limited to a 14.1% labour tax. The U.A.E. doesn't levy a profit tax.

Time to comply: 12 hours

Tax payments: 14

Source: PWC


#4 Singapore

Total Tax Rate: 25.4%, including a 7.4% profit tax, 14.9% labour tax and 3.1% in other taxes.

Time to comply: 84 hours

Tax payments: 5

Singapore's TTR for 2011 decreased by 2.3% since the previous year. In response to the financial crisis it cut its corporate tax by 1% and allowed for a 40% property tax rebate. The country also makes it easier for businesses to file taxes limiting the number of payments to five and setting up easy and efficient online payment systems.

Source: PWC

#3 Hong Kong, China

Total Tax Rate: 24.1%, including a 18.7% profit tax, 5.3% labour tax and 0.1% in other taxes.

Time to comply: 80 hours

Tax payments: 3

Hong Kong's decision to scrap its tax on diesel was on of its biggest tax reforms which in part helped propel it to third place.

Source: PWC

#2 Qatar

Total Tax Rate: 11.3%. This is limited to a 11.3% labour tax.

Time to comply: 36 hours

Tax payments: 3

Beginning January 2010, Qatar reduced its corporate income tax for foreign-owned businesses operating in the country. It expanded its tax base to include taxes on companies with a temporary set-up in Qatar; profits made from public offerings of companies based in Qatar; on contracts between domestically based companies and foreign companies and more.

Source: PWC

#1 Maldives

Total Tax Rate: 9.3%. This does not include profit or labour tax and is limited to a 9.3% rate on other taxes.

Time to comply: 0 hours

Tax payments: 3

Maldives has a 9.1% tax rate in property transfer tax and 0.1% tax each on business and vehicle registration fees. The bulk of its corporate tax revenue comes from taxes on profits of the banking sector.

Source: PWC

Some areas are worse than others...

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