A freeport is designated geographic location or locations within a jurisdiction where some of the normal tax rules of the jurisdiction do not apply e.g. customs or excise duties are suspended or taxes on profit are applied at rates lower than those normally charge and lower land taxes are charged.
Freeports are sometimes called special enterprise zones.
Freeports are usually intended to induce the relocation of economic activity from other countries. They provide light touch regulation in most cases, but they have also attracted criminality and as a result are often criticised by money laundering agencies.
There is little evidence that freeports create growth within jurisdictions even when that is their stated purpose. In many cases they merely relocate jobs within a jurisdiction with the employers of those people relocated securing the benefits of the tax advantages offered. As a result, freeports usually impose a cost on a society that can rarely be justified by any identifiable benefits arising.
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
