Nauru is a small oval shaped island, it is the smallest independent Republic in the world, by extension and by the number of inhabitants.
It does not have an official capital city and holds the record for the country with the highest level of obesity. Discovered by Europeans in 1798, Nauru became part of German New Guinea in 1888. It was occupied by the Japanese in 1942 and at the end of II World War, in 1947, a trusteeship was established by the United Nations, with Australia, New Zealand and the United Kingdom as trustees. Nauru gained independence in 1968. Nauru lived a period of splendour when a “rich deposit of phosphate was discovered in 1900 and in 1907 the Pacific Phosphate Company shipped the first shipment of phosphate to Australia”… To this day, phosphate mining remains Nauru’s main source of economic revenue.
Interesting to note that the Government decided to manage the proceeds from phosphate, by the creation of a trust: Nauru Phosphate Royalties Trust. In anticipation of the exhaustion of Nauru’s phosphate deposits, substantial amounts of phosphate income were invested in trust funds to help cushion the transition and provide for Nauru’s economic future. As a result of heavy spending from the trust funds, the government faced virtual bankruptcy. With the depletion of deposits, the country sank into a terrible crisis, but the bankruptcy was avoided thanks to the support of Australia, New Zealand and the United Kingdom that poured large sums in compensation for environmental damages caused by the exploitation of the said deposits. In the late 90s of last century, the country to get out of the crisis, “decided” to become a tax haven. From that moment on, it was put on the list of “non-cooperative Nations“. Foreign Trusts, estate and wills Act were first issued in 1972. This law remains mostly unknowned to the general public. It offers purpose trusts and abolished the rule against perpetuity legislation.
Taxation: no taxes!
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