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Liechtenstein Congratulated On Successful Tax Policy

Thursday, September 19, 2013

Standard and Poor's has maintained Liechtenstein's triple A rating, alluding to a stable outlook and highlighting the fact that the Principality's fiscal and financial policies have very much contributed to Liechtenstein's reputation and strength as a safe, reliable, and attractive economic location.

As regards tax policy, the ratings agency emphasized the Government's ongoing commitment to pursuing a fiscal consolidation course to narrow the small fiscal gap. Here, Standard and Poor's noted that the Government recently submitted its third fiscal package to parliament, providing for new revenues totaling around CHF39m (USD42m), to compensate for an anticipated shortfall of tax income. The package provides crucially for a rise in the minimum income tax and for cuts in expenditure. The Government accounts are expected to return to balance in 2017.

Underscoring that economic growth in Liechtenstein relies predominantly on the country's banking and industrial sectors, Standard & Poor's explained that the Principality's low tax regime, coupled with its traditional banking secrecy, and stable political environment, have supported the development of a large financial services sector, which contributed about 27 percent of gross domestic product in 2010. While describing the financial industry, consisting mostly of asset managers, regional banks, and trusts, as a "contingent fiscal liability," the agency nevertheless stressed that the risk is mitigated by the industry's strong capitalization and banks' potential access to the Swiss National Bank (SNB).

While making clear that Liechtenstein's heavy reliance on the financial services industry could lead to "reputational issues," the body praised the proactive work of the Government in swiftly meeting the demands of international regulators, notably by adopting the latest anti-money laundering legislation. Furthermore, it underlined the Principality's commitment to tax compliance and extolled the country's tax agreement policy, in particular its willingness to automatically exchange tax information with other jurisdictions, especially with the UK and with the US. This "effective policy making" is expected to continue, it said, adding that it believes that "the Principality will continue to adapt its financial sector to business models that focus less on banking secrets and tax evasion," vitally important if external regulatory pressures mount.

Commenting, Liechtenstein's Prime Minister Adrian Hasler stated that the triple A rating will enable the country to offer itself up as a highly stable and attractive economic location. However, the top priority for the Government is still to consolidate the state budget, Hasler warned, while insisting that the Government is on track.

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The Report

Offshore Trusts Guide: Introduction

The History of Offshore Trusts
Development of Professional Competence in the Jurisdictions
What Future for the Trust?
The New Age of Transparency
The Swiss Association of Trust Companies
The Society of Trusts and Estates Practitioners

Offshore Trusts Guide: Jurisdictions

Bahamas

Bahamas: Legal Framework and Formation Rules and Fees
Bahamas: 2006 Private Trust Companies Legislation

Barbados

Barbados: Legal Framework and Formation Rules and Fees
Barbados: Supervisory and Licensing Regime and Fees

Bermuda

Bermuda: Legal Framework and Formation Rules and Fees
Bermuda: Supervisory and Licensing Regime and Fees

British Virgin Islands

British Virgin Islands: Legal Framework and Formation Rules and Fees
British Virgin Islands: Special Trusts Act 2003
British Virgin Islands: The Trustee Act 2003
British Virgin Islands: :Supervisory and Licensing Regime and Fees
British Virgin Islands: New Laws on Private Trust Companies
British Virgin Islands: New Private Trust Company Regulations

Cayman Islands

Cayman Islands: Legal Framework and Formation Rules and Fees
Cayman Islands: Supervisory and Licensing Regime and Fees

Cook Islands

Cook Islands: Legal Framework and Formation Rules and Fees
Cook Islands: Supervisory and Licensing Regime and Fees

Cyprus

Cyprus: Legal Framework and Formation Rules and Fees
Cyprus: Supervision, Licensing and Tax

Gibraltar

Gibraltar: Legal Framework and Formation Rules and Fees
Gibraltar: Legislation, Regulation and Supervision

Guernsey

Guernsey: Legal Framework and Formation Rules and Fees
Guernsey: Trusts Law 2007

Isle of Man

Isle of Man: Legal Framework and Formation Rules and Fees
Isle of Man: Supervisory and Licensing Regime
Isle of Man: Uses Clients and Tax Treatment

Jersey

Jersey: Legal Framework and Formation Rules and Fees
Jersey: Supervisory and Licensing Regime
Jersey: Trusts Amendment Act 2006
Jersey: Foundations

Liechtenstein

Liechtenstein: Legal Framework and Formation Rules and Fees
Liechtenstein: Regulation Supervision and Transparency
Liechtenstein: Characteristics of Liechtenstein Trusts
Liechtenstein: Foundations

Madeira

Madeira: Legal Framework and Formation Rules and Fees

Malta

Malta: Legal Framework and Formation Rules and Fees
Malta: The Trust and Trustees Act 2004

Mauritius

Mauritius: Legal Framework and Formation Rules and Fees
Mauritius: Characteristics of the 2001 Trusts Act
Mauritius: Additional Provisions of the 2001 Trusts Act
Mauritius: Tax Treatment

Monaco

Monaco: Legal Framework and Formation Rules and Fees

Nevis

Nevis: Legal Framework and Formation Rules and Fees

Panama

Panama: Legal Framework and Formation Rules and Fees
Panama: Requirements for Acting as Trust Company in Panama

Seychelles

Seychelles: Legal Framework and Formation Rules and Fees

Turks & Caicos

Turks & Caicos: Legal Framework and Formation Rules and Fees
Turks & Caicos: The Voidable Dispositions Ordinance

Vanuatu

Vanuatu Legal Framework and Formation Rules and Fees




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