“Which country has no income tax?” is one of the most-searched questions in international tax. The short answer: around a dozen jurisdictions levy no personal income tax on salaries — but almost all of them tax something else.
Not tax advice. These are statutory headline rates. Tax residency, exit taxes and (for US citizens) worldwide taxation can change everything. Verify with the official authority and a professional.
The no-income-tax countries
| Jurisdiction | Income tax | Corporate tax | VAT/GST |
|---|---|---|---|
| United Arab Emirates | 0% | 9% | 5% |
| Qatar | 0% | 10% | None yet |
| Kuwait | 0% | 15% | None yet |
| Saudi Arabia | 0% | 20% | 15% |
| Bahrain | 0% | 0% (non-oil) | 10% |
| Monaco | 0% | 25% | 20% |
| Cayman Islands | 0% | 0% | None |
| Bermuda | 0% | 15% (large MNEs) | None |
| British Virgin Islands | 0% | 0% | None |
| Bahamas | 0% | 0% | 10% |
See the full, live list on the no-income-tax ranking.
Two very different models
Gulf states fund government from energy revenue, so they have never needed broad personal income tax. But the GCC has rolled out VAT (5% in the UAE and Saudi Arabia, 15% in Saudi Arabia after a 2020 hike) and, in the UAE, a 9% corporate tax from 2023.
Offshore financial centres like the Cayman Islands and BVI raise money from company registration fees, customs duties and tourism instead of income tax. Several now face the OECD’s 15% global minimum tax on large multinational groups — which is why Bermuda introduced a corporate tax in 2025.
”No income tax” is not “no tax”
A zero income-tax headline hides real costs:
- Consumption taxes — VAT/GST of 5%–15% in several of these places.
- Social security / payroll — the BVI levies payroll tax up to 14%; Gulf states require contributions for nationals.
- Cost of living — Monaco and the Cayman Islands are among the most expensive places on earth.
- Residency rules — you generally have to actually live there (and often invest) to benefit.
The bottom line
If your goal is lower personal income tax, these jurisdictions deliver — but model the full picture, including VAT, corporate tax if you run a business, and your home country’s exit and citizenship rules. Compare any two on the country pages or with the tax calculator, and read the best low-tax countries for expats next.
Sources
Rates from PwC Worldwide Tax Summaries, cross-checked with the OECD and Tax Foundation. Statutory headline rates as of June 2026. See our methodology.