Tax Haven Aruba

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Over the years, offshore financial services in Aruba tax haven have contributed towards promoting Aruba as a hub for international business and investment. Aruba tax haven is identified as a gateway to Latin American and Caribbean markets thanks to the island’s proximity and close relations with Venezuela and other Latin American countries. The establishment of free zones in Aruba tax haven increased the country’s competitiveness by allowing companies to operate in a preferential tax environment where products can be repackaged, processed, imported, stored, assembled and companies can provide medical, consultancy, sales and internet-mailing services.

Country Overview

Located in the southern Caribbean, north of Venezuela, tax haven Aruba belongs to a group of islands commonly known as the ABC Islands (Aruba, Bonaire, and Curacao). Like other Caribbean islands, tax haven Aruba was first settled by Amerindian tribes (Arawaks) who traveled south from Venezuela in canoes made from dug out tree trunks. European sighting of Aruba was officially recorded in 1499 when Amerigo Vespucci and Alonso Ojeda landed on the island.

Tax haven Aruba has a population of about 100,000 and is divided into 7 main towns, namely, Ornajestad, Santa Cruz, San Nicolaas, Savaneta, Noord, Sero Colorado and Barcadera. National Day on tax haven Aruba is celebrated on March 18 and carnival, Christmas and Easter holidays are recognised.

Tax haven Aruba has mostly flat terrain, many white sand beaches and is dry throughout the year. This encourages tourism in tax haven Aruba as tourists are sure of favorable weather conditions for recreational sports, sun bathing, site seeing, diving, sailing, shopping and self-entertainment. The majority of tourist developments have taken place on the southern and western parts of tax haven Aruba where beaches are naturally protected from strong ocean currents, while the east and northern coasts remain relatively isolated due to rough seas.

Thanks to unique natural landscape and favorable weather conditions, tax haven Aruba has been able to develop as a prime tourist destination. For many years, Aruba depended on processing oil for earning income and foreign exchange, but today, tourism is the most important economic activity. Aruba tax haven has one of the highest GDP’s in the region which in 2007 was estimated at about USD23, 831.

Aruba Fiscal Incentives and Advantages

Aruba tax haven is considered a low tax jurisdiction. Incentives are classed as General Incentives (example, tax credit or investment allowance, accelerated depreciation) and Specific Incentives (for real estate development, free zone companies, export and manufacturing industries, hotels, offshore banks, investment and royalty companies and Exempt Companies). In 2001, free trade legislation was passed to facilitate growing sectors, particularly in services such sales and marketing, engineering, software development, medical clinics, R&D and logistics. Aruba tax haven companies established in free zone areas benefit from exemption from import duties, exemption from fees payable on foreign currency payments and transfers, exemption from tax on a company’s turnover and 2% corporate tax on profits earned from activities conducted from within free zone. Other Aruba tax haven benefits include:

  • Liberal economic policies
  • Thriving manufacturing and transshipment sectors
  • Forward looking European and Latin American Trade relations
  • Political and social stability
  • Supportive and responsive government
  • Free Trade Zones
  • Companies operating in free zones can be fully foreign owned
  • No minimum capital requirement for free zone companies
  • Multilingual and trained professionals

Aruba Offshore Services

Aruba tax haven offshore sector was jump started by the introduction of the Aruba Exempt Company or Aruba Vrijestelde Vennootschap (A.V.V.) in 1988 with the intention of providing foreign investors with a corporate vehicle that would facilitate external trade. However in 2005, all other offshore entities that were legislated subsequent to the AVV were abolished through a systematic phase out process. Only the AVV was kept and in January 2006 was remodeled. Currently, to strengthen its position as an international center and be better able to serve a broad based clientele for business and investment, Aruba tax haven presents the following offshore services:

  • Aruba Exempt corporation creation, comparable to Belize company formation
  • Trust administration,
  • Management consulting
  • Administrative reorganization
  • Tax planning and consulting
  • Payroll-related services

Aruba Legislative Framework

New laws to regulated Aruba tax haven offshore services were enacted following the FATF’s 1995 report. A series of amendments were made to the fiscal regime, signaling major changes for the offshore sector. Several measures were in regard to Aruba tax haven free zones, gambling and casino sector, implementing KYC polices, combating money laundering and regulations for the use of legal entities. Some of the legislative enactments include the:

  • Identification and Reporting Ordinances
  • Reporting Ordinance, 1996
  • Identification Ordinance, 1996
  • Central Bank Directive
  • State Ordinance on the Supervision of the Credit System (SOSCS) (Amendment, 2009)
  • State Ordinance Supervision Money Transfer Companies AB 2003 no. 60 (Amendment, 2009)
  • State Ordinance on Company Pension Funds (SOCPF) (Amendment, 2009)
  • State Ordinance on the Supervision of Trust Service Providers (SOSTSP) (2009)

Aruba Financial Centre

The Aruba Financial Center is the regulatory authority of the non bank financial sector. The Center is a government entity that incorporates all limited liability companies and issues permits for these companies. The Center also issues permits for companies that act as a legal representative and/or director companies which ultimate beneficial owner does not reside in Aruba. The Center is an advisory body to the Minister of Finance and Economic Affairs on policy matters regarding the non bank financial sector and drafts legislation in that respect.

The Chamber of Commerce & Industry

The Chamber of Commerce in tax haven Aruba administers both the Commercial Register and the Foundations Register. The Chamber validates certificates of origin, provides registration information to, validate documents certifying the origin of goods, known as EUR-1 Certificates. Aruba’s Chamber of Commerce aims to encourage business activity while protecting the public interest, provide representation to the business community and offer promotional services for the trade and industry in Aruba tax haven.

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