The term offshore companies is not new in the business world. It has been around for a long time now. Offshore Industry is said to have started in Vienna back in 1815 when Switzerland declared that it would become a neutral state. It is since then that the industry has developed slowly but steadily. After a hundred years, the European elite massively took advantage of this industry but all this time offshore companies remained a comparatively smaller scale industry.
Then, World War II took place and after the Great War, the British middle class became vulnerable to economic hurdles. The middle class looked for a way to protect whatever wealth and assets were left, from a continuous series of sanctions by the British government. The government kept imposing laws that were punishing the top income tax rate of 90% that the development of a more expansive unregulated financial industry was established. During the 1960s, the British government passed the legislation that permitted the use of trusts; leading to the creation of the Euromarket.
This legislation gave banks a way to carry out unregulated deals with foreign entities only if they were to use foreign currency, which both helped to create a more liberalized financial system.
Soon, the British Empire dissolved but many of its former territories took this newly found freedom and turned it into an opportunity. With the help of creating a ‘safe haven’ for assets in other countries, people were able to generate a surge of new profits that were used for the development of this newly found offshore industry. This industry that started much smaller is now covering the globe and remains an important part of international finance. Offshore companies are centers throughout the world, such as the UK and NZ and these remain competitive in today’s globalized marketplace. The idea of tax havens has probably been around since the ideas of governments to tax their citizens.
Offshore company formation in Dubai is a booming industry, set up with the prime motive of operating outside the location of its ownership. RAK offshore company competes by keeping taxes low and thus attracting business from high tax countries. Sometimes a country dedicates its region or city as a low tax or tax-free zone. It is done for the purpose to stimulate its economy or to buy the loyalty of its citizens.