User:Montecara/Sandbox 11: Difference between revisions

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'''Taxation in Montecara''' is administered by the [[College of State (Montecara)|Secretariat of Finance]].


[[Montecara]] is known as a {{wp|tax haven}} and {{wp|offshore financial hub}} thanks to its lack of income, {{wp|capital gains tax|capital gains}}, and {{wp|estate tax|estate}} taxes.
Residency is established for tax purposes by being physically present or employed in Montecara for 183 days in a calendar year.
== Direct taxes ==
Montecara does not assess a personal {{wp|Income tax|income tax}} or a {{wp|Capital gains tax|capital gains tax}}.
=== Corporate income tax ===
Corporate income tax is assessed on the net profits of corporations, cooperatives, and other business ventures. Resident companies are taxed on their worldwide income, except for profits derived from foreign branches and foreign immovable property, which are exempt.
Corporate income is taxed at two rates: a "trading rate" of 13.5% applies to regular income earned from business activities, and a higher "passive rate" of 22% applies to earnings made on non-business activities such as rents, investments, and interest.
=== Dividend tax ===
=== Foreign worker tax ===
Foreign worker tax is charged to employers for each foreign employee hired. The rate depends on the employer’s industry and the ratio of foreigners to Montecarans employed in the company.
=== Transfer tax ===
Transfer tax is charged to the buyer or recipient when certain types of property are sold, traded, or given away. Montecara charges a transfer tax on three categories of property: real property, meaning land and buildings; securities, which are mostly stocks and bonds; and cryptocurrency.
Montecara does not assess {{wp|Estate tax|estate tax}} or {{wp|Gift tax|gift tax}}.
{| class="wikitable"
|+ Transfer tax rates
|-
! Category
! Rate
|-
| Cryptocurrency
| 0.50%
|-
| Real property
| 1.125%
|-
| Securities
| 0.015%
|}
Surtaxes apply to certain transfers of real property determined by the residency status of the buyer, the use of the property (residential, commercial, or industrial), the holding period of the property, and the number of properties owned. These surtaxes can increase the overall transfer tax rate up to 15%.
=== Land value tax ===
Land value tax is assessed on the unimproved value of land. It currently stands at 2.75% with limited exemptions (e.g. diplomatic and consular missions and international organizations).
=== Withholding tax ===
Withholding tax is assessed on certain payments to non-residents. For instance, a withholding tax on income is levied on income earned in Montecara by a worker domiciled abroad, and a technical service fee withholding tax is levied on technical and professional service fees paid to non-residents.
{| class="wikitable"
|+ Withholding tax rates
|-
! Category
! Rate
|-
| Dividends
| 17%
|-
| Income
| 22%
|-
| Interest
| 17%
|-
| Remittances
| 17%
|-
| Royalties
| 10%
|-
| Technical service fees
| 17%
|}
== Indirect taxes ==
=== Excises ===
[[File:Cig-tax.png|200px|thumbnail|right|Tax stamp for cigarettes sold in Montecara]]
Excises are {{wp|per unit tax|per unit taxes}} paid on specific items when they are created or imported.
{| class="wikitable"
|+ Alcohol taxes
|-
! Category
! Rate
|-
| Beer or cider ≤8% {{wp|Alcohol by volume|abv}}
| Ł225/{{wp|Hectoliter|hl}}
|-
| Beer or cider >8% abv
| Ł375/hl
|-
| Spirits
| Ł160/l of pure ethanol
|-
| Wine ≤15% abv
| Ł365/hl
|-
| Wine >15% abv
| Ł725/hl
|}
{| class="wikitable"
|+ Cannabis and tobacco taxes
|-
! Category
! Rate
|-
| Cannabis (dried plant matter)
| Ł2,000/kg
|-
| Other cannabis products
| 35% of wholesale price
|-
| Cigarettes (pack of 20)
| Ł12
|-
| Cigar ≤ 10g
| Ł7
|-
| Cigar > 10g
| Ł9
|-
| Loose tobacco
| Ł700/kg
|-
| Other nicotine-containing products
| 50% of wholesale price
|}
{| class="wikitable"
|+ Documentary taxes
|-
! Category
! Rate
|-
| Insurance
| 4.75% of premium
|-
| Reinsurance
| 1.25% of premium
|-
| Mortgages
| 0.25% of payments against principal and interest
|}
{| class="wikitable"
|+ Environmental taxes
|-
! Category
! Rate
|-
| Fluorinated gases
|
|-
| Landfill waste
| Ł80/tonne
|-
| Ozone-depleting substances
|
|}
{| class="wikitable"
|+ Fuel and energy taxes
|-
! Category
! Rate
|-
| Diesel
| Ł6.35/l
|-
| Kerosene for use in aviation
| Ł2.15/l
|-
| Kerosene for other uses
| Ł3.00/l
|-
| Gasoline
| Ł5.75/l
|-
| Aviation gasoline
|
|-
| Liquefied petroleum gas (LPG)
| Ł1.90/l
|-
| Compressed natural gas (CNG)
|
|-
| Liquefied hydrogen
|
|-
| Liquid fuel derived from biomass
|
|-
| Liquefied natural gas (LNG)
|
|-
| Heavy fuel oil
| Ł2.85/l
|-
| Coal and coke
| Ł15.50/{{wp|Gigajoule|Gj}}
|}
{| class="wikitable"
|+ Utility taxes
|-
! Category
! Rate
|-
| Electricity
| Ł22/MW·h
|-
| Natural gas
| Ł2.55/m³
|-
| Water
|
|}
=== Tariffs ===
Montecara is a {{wp|free port}} and levies tariffs on only two line items: fresh fish at 3.5% and works of art at 6%. The overall weighted mean tariff rate is 0.0%. Receipts from tariffs totaled approximately Ł133 million (€26 million) in 2019.
=== Value-added tax ===
Value-added tax (VAT) is levied on the consumption of goods and services.
There are four rate categories for the purpose of assessing VAT: standard (20%), reduced (12%), zero (0%), and exempt. The reduced rate applies to food (non-prepared), animal feed and fertilizer, livestock and fishstock, seeds and living plants for cultivation, grain, medication, and utilities. The zero rate applies to direct deliveries of goods abroad, cross-border transport services, and services for customers abroad. Rent and the sale of real estate, banking and insurance services, postal services, medical and dental services, welfare and social services, and education are exempt.
An environmental surtax of 4% is added to the applicable rate for airline and cruise tickets, fishing equipment, fossil fuels, single-use plastics, motor vehicles, electronic goods, tires, and household appliances.
== Discontinued ==
=== Straits tolls ===
Thanks to its strategic location in the [[Aurean Straits]], Montecara was for centuries able to tax the ships and goods that traversed its littoral. Vessels refusing to stop and be taxed were summarily bombarded by the extensive network of coastal artillery. This was the major source of funding between the fourteenth and nineteenth centuries. Straits tolls ended with the Gaullican annexation and were not reinstated when Montecara regained independence.
=== Salt tax ===
{{wp|Salt tax}} ([[Montecaran language|Montecaran]]: ''gabèla'') was first imposed in the fifth century CE and was levied in some form up to the late nineteenth century. It was for many centuries the single largest source of revenue for the Montecaran state, though it was often bitterly resented by common people. At times it required the purchase of a fixed quantity of salt monthly by every man, woman, and child in Montecara.
{{Template:Montecara topics}}
[[Category:Montecara]]
[[Category:Taxation by country]]

Latest revision as of 17:36, 21 March 2024

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