For many years, banking secrecy was observed in Andorra, there was no VAT with income tax, high-class professional workers worked in the banking area. In Andorra, there was a certain kind and independence in making decisions.
France and Spain are located near Andorra, which is an important advantage for this state.
In the last couple of years, the situation in the country has changed significantly. Andorra has undergone a lot of the demands of the world order. First of all, the threats and demands from the European Union played a role.
And because of this, Andorra began to make concessions to the international community. The first step towards such concessions was the creation of a taxation framework, it introduced ten percent taxation on the income of legal entities and individuals, and 4.5% VAT appeared in Andorra.
But, in general, the country has excellent chances for a significant reduction in tax rates.
Banking secrecy in Andorra
At first, the state agreed to exchange data on bank depositors of the EU countries. This immediately reduced the number of investors from European countries.
To date, the state has not only left its signature on the pages of a multilateral agreement on the exchange of banking information. The country plans to start sharing this information.
Starting in 2018, she plans to collect and forward information about those investors who have more than one million USD in their personal accounts.
It is planned that from 2019, in Andorra, such a concept as “Bank secrecy” will cease to exist. One more state will be included in the list of the state with “total transparency” – albeit regarding the issues of bank depositors.
Andorra is now entering a new stage of its development. Traditional means of attracting customers are already not working enough – moreover, they are in little demand and even quite risky.
New techniques are only at the stage of formation. Andorra may well find its application as a country not only for the preservation of banking assets, but also as a tax residence for individuals.
Features of the legislation when registering a company in Andorra
It is easy to register a company in Andorra. In the summer of 2017, legislation came into force in Andorra, which provides for criminal liability for tax violations.
In case of evasion in the amount of 80-160 thousand euros, the offender can be imprisoned from three months to three years. He also undertakes to pay a fine.
If a person has not only evaded paying taxes, there are other state crimes for him, for example, he “laundered” illegal money, then the prison term can be extended by five years, and the amount of the fine will be increased.
Banking secrecy is an outdated concept. New rules also dictated new requirements. For a minimal offense, the severity of punishment increases. So why provoke a provocation of a system that was launched to collect taxes and fines?
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