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Euro
Tax Haven Threat
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by:
Roger Munns
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Media
reporting of a new EU savings tax directive has left many people
wondering whether European tax havens could soon become obselete.
The July directive requires banks throughout Europe, including low and
no tax areas such as Gibraltar, Monaco, Malta and Andorra, to disclose
bank account owner information to their home country’s tax authority.
But Roger Munns, Managing Director of tax haven property specialists
Tribune Properties, says that some of the reporting has been less than
accurate.
‘The purpose behind this directive is primarily aimed at those who hold
illicit funds, such as drug dealers, who will need to look outside of
the European banking system to place large cash deposits. The main
attraction of Monaco and Andorra is the zero per cent income and
inheritance taxes, and this remains intact and there are no plans
whatsoever to change this.’
Monaco and Andorra have long been favoured destinations for the well to
do, but with new technology allowing businessmen and women to run their
offices from anywhere in the world, operating from low tax bases has
seen added interest for Europe’s primary tax havens, doubling property
prices in the last ten years.
Both Monaco and Andorra are outside the EU, and their signing of the
directive voluntarily is often overlooked in the media’s analysis of
any effects on the two small countries long term popularity.
Property prices have risen steadily over the last decade, often topping
ten per cent a year, but this year has seen a slow down of that
increase.
Property Price Uncertainty
Both Monaco and Andorra’s property prices have seen a levelling off
this year, according to Tribune Properties, but say this can be
explained by factors other than the new EU directive.
Tribune say that in Monaco the passing of Prince Rainier earlier this
year cast a shadow over the Principality, while in Andorra the local
market has slowed as Andorrans struggle to keep up with the price of
property, fuelled by buyers from around the world seeking residency.
Two other factors have contributed to the slow down in the first half
of the year which could be reversed in the second half – the absence of
UK buyers awaiting the outcome of their election in May which saw the
Labour Government returned for a historic third term with Tony Blair as
Prime Minister and possible tax rises in the pipeline, and buyers
holding US dollars who were hit by the rise in value of the Euro –
which has now peaked following the EU Constitution ‘No’ votes in France
and The Netherlands in June.
Both Andorra and Monaco require new residents to live there for six
months a year to maintain their residency (but Andorra doesn’t police
this once residency is granted). Andorra property prices start from
just over 200,000 Euros for a one bedroom apartment, while Monaco is
more expensive with one bedroom apartments from around 600,000 Euros.
Tribune Properties offer details of properties for sale in both Andorra
and Monaco. For Andorra property visit http://www.propertyandorra.com
, for property and real estate in Monaco and Monte Carlo http://www.monacoproperty.net
Tribune also offer to e-mail current property for sale in Malta at http://www.maltaproperty.info
and property in Menorca at http://www.menorcaproperty.info
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