50s: Starting with a storage ring

Chapter 820 Tax Havens
Sun Zhiwei didn't expect that he and Christie's would make a small profit before the auction even started.

Christie's will cover all the tax issues related to this money.

This isn't because they're being generous; the truth is, Christie's doesn't pay much tax at all on Hong Kong Island.

Their companies are registered in the British Virgin Islands, a so-called "tax haven," and the existing Hong Kong tax laws have little to do with them.

The so-called "tax haven" refers to countries and regions that attract foreign capital through tax exemptions, low tax rates, or special tax incentives.

Its main characteristics include opaque financial information and a lax tax system.

Many of these "tax havens" do not collect taxes on these offshore companies that use them for tax avoidance, except for a fixed annual management fee. They only charge a small handling fee for the transfer of funds through banks.

The world's major tax havens currently include the Cayman Islands, the British Virgin Islands, Jersey, Bermuda, Nauru, Panama, and Luxembourg.

The Cayman Islands, in particular, has no income tax, capital gains tax, property tax, inheritance tax, or value-added tax, which greatly reduces the operating costs of setting up offshore companies and funds there.

Many well-known companies in later generations registered in the Cayman Islands, including Google, Starbucks, Awai, Tengman, 100°, Jingxi, 60, Lianxiang, Choutuan, Jiulang, and Xiaomai, among others.

These companies register in the Cayman Islands and then use the shell company to acquire their own companies in China, thus enabling them to list overseas.

The British Virgin Islands has the lowest registration requirements and the least regulatory oversight.

There, the minimum registration fee for setting up a company with a registered capital of less than $5 is only $300. Including license fees and handling fees, the local government charges a total of $980.

After that, the company only needs to pay a $600 annual business license renewal fee.

Companies registered in the British Virgin Islands include Fortune 500 companies such as Qiaoxing, SO Hu, Shengxiao, Mengyang, Zhongshi (?), Zhongtonglian, etc.

The British Jersey Islands, with its relaxed legal system, has attracted numerous European financial institutions.

Its Channel Islands provide shelter for 225 banks and 820 investment funds.

Bermuda is considered one of the best locations for handling insurance and reinsurance business. Sixteen of the world's top 35 insurance companies are based there.

The island is also considered one of the best locations for managing family businesses. Companies registered in Bermuda include Slippery.

Nauru has a banking secrecy system, and currency exchange activities are unregulated and lax in management. A bank can be opened locally with just US$2.5.

Registering a company in Panama is quick and easy, with numerous favorable legal measures that can alleviate business owners' concerns about their actions not complying with international regulations.

Hong Kong Island itself does not have strict tax policies, as there is no capital gains tax, capital flows are flexible, and international financial facilities are well-developed.

It must be said that tax havens are truly a haven for capital. Every year, the world's major tax havens help countless companies around the world avoid trillions of dollars in taxes.

But the more they do this, the more they incur the resentment of sovereign nations around the world.

As the international community intensifies its crackdown on tax avoidance and evasion, global tax havens are facing policy challenges from sovereign nations around the world.

Decades later, the current "tax haven" countries have largely changed many of their financial and tax policies under pressure from major world powers.

In 2017, the EU announced a blacklist of tax havens. These included Eastern Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Australia (China), Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia, and the United Arab Emirates.

This is completely different from the current list of "tax haven" countries.

Of course, we also need to rationally analyze the reasons why many companies register offshore companies. Even many state-owned enterprises register offshore companies because this method can avoid many international policy risks.

For example, when America wanted to circumvent jurisdiction to sanction a company from a certain country, she suddenly discovered that the company's registered address was actually in the Cayman Islands, and as a result, the company successfully circumvented the sanctions.

The politically detached status of island regions like the Cayman Islands has made them a safe haven for businesses to avoid the risks of policy interference.

In conclusion, Sun Zhiwei is learning from those large international companies in this regard.

Robert Group President Huang Mingyu is working on this, and it is expected that Robert Group will become an offshore company in the first half of next year.

Given the mad dog-like behavior of America's IRS, who would want to suffer in America? Those established businesses would have already run away if they didn't have the backing of the American government.

Capital is profit-driven; those who stayed are those who have huge profits to make.

For example, companies like Lockheed Martin (fighter jets, missiles, satellites), Northrop Grumman (radar, missiles, aircraft carriers, submarines, bombers, drones), Boeing, and General Electric.

They may receive government support, obtain government and military contracts, or receive tax subsidies.

In short, they stay because the benefits they gain from staying outweigh the benefits of tax avoidance overseas.

Time flew by and it was almost the end of November. Christie's was all set for its first auction on Hong Kong Island.

Two weeks ago, they sent auction invitations and auction catalogs to their major clients around the world.

Originally, this first auction on Hong Kong Island was a small-scale event focusing on Chinese antique porcelain. At that time, Asian antiques did not have a wide audience worldwide, and Christie's did not plan to make it too big.

But now that Sun Zhiwei has intervened, the theme of this auction has changed drastically.

Keywords such as "ancient Indian treasures", "golden treasures", and "antique jewelry" all refer to content with a very wide audience.

Christie's immediately changed its strategy, rapidly expanding its advertising, which was originally focused on Asia, to the entire world.

The feedback afterward was excellent. The only noise came from Third Brother's house. They wanted to share the treasure, but Christie's ignored them. However, Sun Zhiwei made a fuss about it against Third Brother.

11月25日上午10点，位于港岛中环遮打道18号历山大厦22楼，佳士得亚洲总部的1号拍卖大厅人头攒动。

Those invited by Christie's are all wealthy people from all over the world, but Sun Zhiwei, who was secretly observing backstage, didn't recognize almost any of them.

Even if many people give their names, Sun Zhiwei doesn't know who they are, and their names are not even on the Forbes rich list.

But they are all real millionaires. Many of them are not well-known, and their companies are often in niche industries, but they are truly wealthy.

(End of this chapter)