Currencies, Taxes and Citizenship By William Cate July 2004 [http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]Would you accept 1,185,000,000 Tugriks for your company? If you invested in a company, would you accept repayment of your investment and profits in Tugriks? Outside of Mongolia, where
Tugrik is national currency, answer would be NO!
Acceptable International Currencies
Today, there are five major world currencies: U.S. Dollar, British Pound, Japanese Yen, Euro and Swiss Franc. Payments in any of these five currencies are acceptable almost everywhere in World.
There is a secondary tier of about twenty semi-acceptable world currencies, like Canadian Dollar. They can be used in international business because they can be converted into five major world currencies without issuing Government's review of currency transaction and Government's potential intervention and termination of payment.
Back to Tugriks
If you have a feed business in Ulan Bator, Tugriks are great. If you expect to die in Mongolia and have your children manage your feed business, Tugriks are terrific. However, if you want to expand your feed business into Russia or PRC, Tugriks become a serious handicap to your plans. If you want to send your children to Cambridge, registrar won't accept Tugriks for their tuition. Should you decide that Mongolian Winters are more than you care to withstand in your old age, you can't use Tugriks to relocate to South Pacific.
Assuming that you have average intelligence and a global vision, you'll do business in a major world currency. It's only way that your company can grow beyond your national borders. It's only way that you, your family and heirs will survive comfortable for next hundred years. There is a saying in States that few people heed. Don't put all your eggs in one basket. History teaches us that eventually political, economic and social upheaval destroy any basket (country).
Taxation Is Not Uniform Around World
In 11th Century, Robinhood fled to Sherwood Forest, objecting to a 20% Government income tax rate. A millennium later, income tax rate in UK is 50% and nobody knows exact location of Sherwood Forest. This isn't progress.
At this time, you can find your Sherwood Forest in Belize, Nevis, Cayman's, Nuie, Bahamas and a list of low tax countries. If you have a global business, it must be located in a low tax country to maximize your profits. If you want to maximize your income, your investment profits must be taken in a country that will tax them least. I'm among guides to modern Sherwood Forests. If you don't see logic in operating from Sherwood Forest, you can't succeed in Global Village.
