TAX from Individuals are sourcing the finance of OECD Governments,
international competition is the only way to control them
Average OECD Revenue Sources
More than 80% of TAX for a Government is coming from individuals,
so if you want to change your monopolist regime supplier you just have to move away from him … action, please … but now the competition amongst the State is enlarging from Corporate tax to VAT tax … in Europe first
To summarize briefly, as an individual you can be a shareholder of a company located in a jurisdiction with the most effective tax rate, without being located there with your substance. Instead, to be rewarded by a better tax rate at the individual level (natural person), you have to move your substance and your center of interest in that most performing jurisdiction.
Now in Europe since 2019, after corporate tax you will see in EU the competition for the lowest VAT taxation, because with the end of the geolocalization you can buy and sell in the jurisdiction where VAT is lower …. but substance always matters to be really compliant.
Corporate tax is an area where the single country cannot play the monopolist role as a supplier, as an individual you can do the same for yourself and your assets moving and locating to find the best government suppliers as the business do, because the tax competition amongst the jurisdictions is very healthy for a better world and because the borders are just a limit only in your mind
In 2017, OECD countries raised one-third of their tax revenue through consumption taxes such as the Value-Added Tax (VAT), making consumption taxes on average the most important revenue source.
Sources of Tax Revenue: U.S. vs. OECD
The top 3 sources of U.S. tax revenue are individual income taxes, social insurance taxes, and consumption taxes. Compared to the OECD average, the U.S. relies significantly more on individual income taxes and property taxes
In the United States, individual income taxes (federal, state, and local) were the primary source of tax revenue in 2017, at 38.63 percent of total tax revenue. Social insurance taxes made up the second largest share, at 23.05 percent, followed by consumption taxes, at 15.85 percent, and property taxes, at 15.4 percent. Corporate income taxes accounted for 7.07 percent of total tax revenue.
For any advisory needs and benchmarks amongst different jurisdictions contact us for Malta and the world
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