Which feature is most commonly associated with a jurisdiction described as a ‘tax haven’?
Question and options
Which feature is most commonly associated with a jurisdiction described as a ‘tax haven’?
No or only nominal tax on the relevant income
A wide network of tax treaties with India
A withholding tax on all outbound payments
Taxation of residents on their worldwide income
Answer and explanation
A tax haven is a jurisdiction that levies no or only nominal tax on the relevant income, usually combined with secrecy and little exchange of information, which is why it attracts profit shifting. A treaty network, worldwide taxation of residents and withholding taxes are features of ordinary tax systems, including India's.
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