Briefly explain the following subjects in the context of International Taxes : (i) Tax Havens

(i) Tax Havens Tax havens are jurisdiction which tends to have nil tax or low tax rate. Tax havens may also be jurisdiction which has other benefits like financial secrecy, minimum reporting requirements, ring fencing, discretionary tax privileges, allowing ownership to be held in trust, no registry of companies and partnership, no taxes on dividends and interest payments to non-residents, etc. Several countries have SAARs i.e. Specific Anti Avoidance Rules to limit the deductions of tax expense or tax benefits to entities located in tax havens. For e.g. India has enacted section 94A, where on being notified, there is restriction on allowability of payment to entity in such jurisdictions, higher withholding taxes, applicability of Transfer Pricing provisions etc.