Tax Haven - Money and Exchange Control

Money and Exchange Control

See also: Fixed exchange rate, Dollarization, and Money laundering

Most tax havens have a double monetary control system which distinguish residents from non-resident as well as foreign currency from the domestic one. In general, residents are subject to monetary controls but not non-residents. A company, belonging to a non-resident, when trading overseas is seen as non-resident in terms of exchange control.

It is possible for a foreigner to create a company in a tax haven to trade internationally; the company’s operations will not be subject to exchange controls as long as it uses foreign currency to trade outside the tax haven.

Tax havens usually have currency easily convertible or linked to an easily convertible currency. Most are convertible to US dollars, euro or to pounds sterling.

Read more about this topic:  Tax Haven

Famous quotes containing the words money and, money, exchange and/or control:

    “The secret point of money and power in America is neither the things that money can buy nor power for power’s sake ... but absolute personal freedom, mobility, privacy. It is the instinct which drove America to the Pacific, all through the nineteenth century, the desire to be able to find a restaurant open in case you want a sandwich, to be a free agent, live by one’s own rules.”
    —Joan Didion (b. 1934)

    “For the people in government, rather than the people who pester it, Washington is an early-rising, hard-working city. It is a popular delusion that the government wastes vast amounts of money through inefficiency and sloth. Enormous effort and elaborate planning are required to waste this much money.”
    —P.J. (Patrick Jake)

    “The social kiss is an exchange of insincerity between two combatants on the field of social advancement. It places hygiene before affection and condescension before all else.”
    —Sunday Correspondent (London, Aug. 12, 1990)

    “The awareness that health is dependent upon habits that we control makes us the first generation in history that to a large extent determines its own destiny.”
    —Jimmy Carter (James Earl Carter, Jr.)