I have no bias in this pissing contest, but I'd like to point out there are laws and facts, and then there are "laws" and "facts". Especially in developing countries.
@dw31583: I suspect you don't actually need me to spell it out but here I go anyways. Laws are useless without enforcement. Even with enforcement, depending on who you are and how much money you have, laws can be bent, amended, or outright disregarded. You and luisHK are just arguing sematics. You are right that are exist certain laws, luisHK is equally right that certain places in the world care nothing for enforcement of said laws.
I'm the guy who could never navigate successfully in those systems. I always happened to upset the wrong person and whenever I wanted something that was available for all the people who knew someone, I was out of luck So I'm sure sex outside of marriage laws doesn't apply to celebrities, well known people, known business people and politicians but it certainly applies to me and based on my experience I would meet a guy from my country on the day I bought my Ferrari and he would report me to the police for anything he could This is why I stick to places where everyone has the same rights on every day basis. Yeah, sure, if you worth $1b+ then some rules doesn't necessarily apply to you the same way even in the US or UK but in general the rules in Western democratic countries are harder to bend or more like impossible. Even when it seems to be bent it's more like using another law or a legal loophole but nothing like in the UAE or in another dictatorships. Well, I can understand that these countries may work well for some people but not for me. I prefer to live in places where I can protect myself with my money that I've worked for and I don't depend on my connections or another person's connections. Anyway, you're right in that we both are right, we just see the world from a different angle and live with a different mindset.
I don`t deny, that there are jurisdictions with bent or neglected tax laws. Would you like to park your money in such a jurisdiction? Would the preferred brokers like it? And btw, it`s a speciality of taxation, that it might catch you after many years (..and chnges in enforcement, laws, persons ...) Why are the rich from such countries move there money (and ass) to countries with stricter laws and enforcement?
As dw ^ said, depends on your view of the world and mindset. If you are completely risk averse, stay in the West and work a middle class job and get a mortgage and raise your family.
Yes, I`m as risk averse as you could be ---- making my money with naked put selling mainly since many years, survived many black swan events (when Karen didn`t). But I can report that I know of a person, retired US military colonel, who lives and trades in RAMSTEIN, Germany. He is NOT liable to the 27% German income tax. Instead he files with the IRS - which allows him the first 100K USD free, as he lives outside the US. I don`t know why he is considered tax exempt by the German taxman - must be said in the US-D DoubleTaxationAgreement, maybe cause he was with the military.
Well, I suspect the good Colonel is full of sh*t and has never traded well enough to have to worry about it.... because he is incorrect. From the IRS code: Expat Tax USA: Exclusions Earnings thresholds The latest threshold for tax-free earnings for US citizens is $95,100 of foreign earned income for the 2011/2012 tax year. Rental income, dividends, interest, capital gains etc. are not classified as earned income and will be subject to taxation.
Hittfled, one doesn't need to keep their money where they live, and you are claiming that residents of persian gulf countries are craving to move overseas, yet, this remains to be proven, even tax crazy France introduced special laws to attract them btw, so they would only pay taxes on their locally sourced income were they to become french residents (I haven't read of a similar exemption for any other country). Yet while I noticed quite a few high end properties in Paris belonging to arabs from the Gulf -mostly qataris- they appear to be occupied only a minority of the time. The fact arabs from the Gulf dream of moving West, while their governments take better care of the needy financially (including subsidies on a lots of goods, money at most ages ,free health and education ) than most western nations do, and where the wealthy can thrive tax free, might be a dream of Hittlfeld at the end of the day. I lived in several countries in emerging markets btw, and while the rich like to send their kids studying overseas, a lot of their kids, as well as their parents, find life easier at home. Even in China it's complicated, many wealthy move out, but what proportion do they represent ? And a significant proportion of those migrants come back once they get a foreign passport or they at least have ensured a long term residency overseas. Salaries are increasing very fast and unemployment is quasi inexistent, I doubt nearly as many working class folks dream of moving out as they used to. It's difficult to look at the West, especially Europe, and think it is the most promising part of the World where to raise kids (low pollution is good, but booming economies matter quite a bit as well ) Chinese definetely have concerns about keeping most of their money in the Mainland though, and capital controls don't help, but again it sounds reasonable to spread one's assets amond several countries and political regimes, one doesn't need to keep all his money in a bank next door, nor do many people with sizeable assets want this.
Anyway I came back to this thread to post a link about a new territorial system in italy, surprised noone mentionned it yet (or was it already flushed down ? I haven't looked up more information on it) I understand active trading from one's own home in italy wouldn't be covered, but most people with significant assets I suspect have other income to show for than their forex profits, plus it states : " In addition to shielding foreign income and gains from Italian tax, the annual charge exempts the taxpayer from a duty to disclose foreign assets in their tax return under the ordinary disclosure rules (a.k.a. 'RW' rules)." So you don't need to declare this income anyway, or show audits of the corporations u use to trade . http://www.withersworldwide.com/news-publications/italy-introduces-a-territorial-system-of-taxation