08/01/2024
Foreign investors VS Local investors (how do they benefit from governments?)
Sometimes. It would take too long to list the benefits to foreign investors here; there are too many to mention, but in some countries there are tremendous incentives to invest in those countries, such as no income tax for ‘x’ number of years, no (or super low) capital gains, investor visas if a certain investment amount is met, super low taxes on dividends and other benefits that locals can’t benefit from.
You should talk to a local accountant and/or attorney in a country you’re considering investing in, or moving to permanently. These tax benefits are more common in lesser developed countries, but there are also countries like Singapore and Ireland that offer foreign investors great tax benefits as well. You should also review the tax and reporting requirements of your home country to make sure the foreign country you invest into makes sense when it comes to bringing money back home (repatriating).
If you’re simply opening an entity in, for example, a specific Caribbean country or Singapore as a hedge fund, the reasons for doing so, and the cost/benefit analysis will be different than starting, for example, a manufacturing facility in Mexico.
The answer to your question is that it really depends on what country the foreign investor is from, their objectives and the purpose of investing in the foreign country and the cost and risk of brining money back to your country of citizenship (if that’s a priority). In many countries the locals share the same financial benefits, but fewer privacy benefits.
