How do countries that don’t charge income tax eg Monaco, Cayman Islands pay for things that tax pays for in other countries eg roads, bridges, military, government buildings, etc
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They’re called tax heavens for a reason. Rich people give them money. So that’s how they can pay for everything.
Because they still collect money other ways.
Monaco, for instance, has a zero percent *income tax*, but has a 20% sales tax, a 1% rental tax, and has low business profit taxes, etc.
The Cayman Islands has no taxes whatsoever, but collects money via fees. Tourism fees, work permit fees, financial transaction fees, and they collect massive duties, with a 0-42% duty fee schedule for all items imported into the country (most imported items are charged duties in the 20% range). Offshore corporations are tax sheltered, but pay an annual licensing fee directly to the government.
Keep in mind they are usually very small.
Monaco is 30 k habitants and ~2 square km , so there’s not a huge amount needed.
They also live under the umbrella of France for most of their infrastructure.
America won several wars and completed the westward expansion without a federal income tax. It’s called keeping your government small and nimble.
America won several wars and completed the westward expansion without a federal income tax. It’s called keeping your government small and nimble.
There are other types of taxes that can be charged — sales tax, property taxes, import duties, etc. Or taxes on specific types of activities (ie. casinos). Those places have small, wealthy populations, heavy tourism, tiny governments, small amounts of land, no military so generating taxes from hotels/restaurant taxes, casino revenues, etc. would be enough to pay for what’s needed to run a small wealthy country.
1) Income taxes isn’t the only tax. There’s sales tax, business tax, property tax, etc that can ask be sources of revenue.
2) If you keep your government relatively small, which is what most of these female countries do, there’s not much need for massive 30+% tax rates on everything.
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