1. Smart Offshore Business
Although most offshore financial centres originally rose to prominence by facilitating structures which helped to minimise exposure to tax, tax avoidance has played a decreasing role in the success of offshore financial centres in recent years. Although most offshore financial centres still charge little or no tax, the increasing sophistication of onshore tax codes has meant that there is often little tax benefit relative to the cost of moving a transaction structure offshore.
Most professional practitioners in offshore jurisdictions refer to themselves as being "tax neutral", referring to the fact that, whatever tax burdens the proposed transaction or structure will have in its primary operating jurisdiction or market, having the structure based in an offshore jurisdiction will not create any additional tax burdens.
For example, international joint ventures are often structured as companies in an offshore jurisdiction when neither joint venture party wishes to form the company in the other party's home jurisdiction, but both parties wish to ensure that the company's jurisdiction of incorporation will not attract unwanted tax consequences.
Many offshore financial centres used to "ring fence" offshore companies formed in those jurisdictions (International Business Companies formed in the British Virgin Islands were a good example).

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