VANUATU’S FRIENDLY TAX REGIME

Vanuatu is well-known for its tax haven status that resulted in a successful offshore financial center, where international companies can be formalized within 24 hours. As at 31st December 2006 a total of 5,042 companies, mainly international companies were registered with the Vanuatu Financial Services Commission.

What has made Vanuatu unique compared to its neighbors is its friendly tax environment, an obvious appeal to investors enhanced by several unique features. Unlike other locations, there is:

• No income or company tax: for residents
• No capital gains tax: allowing foreign investors to buy and sell properties without incurring any cost
• No estate or death duties: an obvious appeal to investors
• No foreign exchange controls: Money is easily transferred in all major currencies and there are no reporting requirements in relation to the movement of funds
• Thriving offshore finance center: a financial infrastructure found nowhere else in the Pacific region that offers professional services to investors who wish to do business in the Vanuatu
• Exemption – exemption on imports duty in the following sectors – Tourism, Manufacturing or processing and Mineral exploration

There are some taxes such as the Value Added Tax (the equivalent of the Australian GST) at 12.5%. However, Vanuatu still managed to top the list of lowest taxed countries in the world reported by the World Bank Doing Business Report – 2015 as shown by figure below.

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