Money and Exchange Control
See also: Fixed exchange rate, Dollarization, and Money launderingMost 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, exchange and/or control:
“Kindness eases everything almost as much as money does.”
—Mason Cooley (b. 1927)
“If mass communications blend together harmoniously, and often unnoticeably, art, politics, religion, and philosophy with commercials, they bring these realms of culture to their common denominator—the commodity form. The music of the soul is also the music of salesmanship. Exchange value, not truth value, counts.”
—Herbert Marcuse (1898–1979)
“Imagine believing in the control of inflation by curbing the money supply! That is like deciding to stop your dog fouling the sidewalk by plugging up its rear end. It is highly unlikely to succeed, but if it does it kills the hound.”
—Michael D. Stephens. “On Sinai, There’s No Economics,” New York Times (Nov. 13, 1981)