The number one all-time rule of wealth preservation is international diversification. This simply means that you take a few proactive steps to protect yourself from the likes of insolvent American and British national governments. These and other nations which are indebted up to their proverbial eyeballs will one day soon be looking for precious metals stashes to seize in bank safe deposit boxes near you. Once this has begun, your capability of buying, selling, or getting your precious metals valuables “out of town” will be severely reduced and possibly even restricted, depending on how bad things get.
Why The United Kingdom and the United States are Not Really Precious Metals- Friendly Jurisdictions for Your Valuables
As good as Great Britain and the U.S. are as places to live, work, and do business, they are ultimately not very safe where domiciling precious metals is concerned. It is not only the debt problems that should worry you. The British have an unfortunate track record of rolling in the drawbridge on the national economy and pound sterling currency alike when things get bad.
For example, consider the late 1960’s when the price fixing scheme of the London Gold Pool suddenly collapsed. The British people and investors were stopped from getting over 50 pounds out of the U.K. This may not be the case today, but since then the British police have demonstrated a worrying trend of raiding safe deposit boxes based in banks on the relentless hunt for terrorism and criminal under-world related assets.
The U.S. is little better truthfully. While the premium and buying side taxes for precious metals are low here, and the precious metals markets are both deep and highly liquid, this has still not stopped the American Federal government from ruining the proverbial “gold standard” currency status of the world, thanks to their reckless spending habits and Federal Reserve’s irresponsible actions meddling with the markets every time the stock market dips.
In the end, it is only a matter of time until a severe crisis in confidence destroys the dollar (ala hyperinflation) or a debt crisis erupts. Either will cause the masses who do not own gold to demand that their politicians raise the taxes substantially on precious metals. Now is the time for American citizens to relocate their gold hoard outside of the Untied States while the restrictions are light and relatively few.
Precious Metals-Friendly Nations
Though there might be other contenders for the coveted top spots on this list, these six countries are the go-to jurisdictions for storing your precious metals so safely that you do not lose any sleep at night.
Switzerland is still the top-rated global safe haven, but just barely. Since it betrayed all of its U.S. and German bank account holders to their respective national tax authorities, its reputation for secrecy has taken a serious hit. Yet they still possess among the most stable of governments and economies, highly valued economic freedom and privacy, and many vaults that are not located in banks and were established particularly with precious metals in mind. It is likely that the Swiss invented the concept of full service gold bailment originally.
There are reasonable import/export duties on precious metals (eight percent VAT on silver purchases made within or brought into Switzerland), though there is no limit on the amount that can be moved in or out of the country assuming you properly declare it at the national borders. The country’s property market and costs of living are sky high though. Most troubling for American investors, U.S. citizens are frowned upon when they attempt to open up a financial services accounts of any kind there nowadays.
Dubai nearly beat Switzerland this year. The independently run emirate (which is a constituent of the confederacy known as the United Arab Emirates) has no customs restrictions, no duties, and no taxes on the export or import of bullion coins and bars. Besides this, they do not levy sales taxes or capital gains taxes even on foreign residents.
The downsides are that the climate is a literal desert and the legal restrictions on activities (and punishments for committing them) permitted here are frankly harsh. For most more liberalized Americans, this would not be their first tier choice of place culturally to call home, though it makes a fantastic vacation destination.
Singapore is another virtual winner of what is almost a three-way tie for first place safest and best domicile for your precious metals hoard. Were it not for their government’s somewhat irresponsible policy of taking on debt to sell securities and invest in their national “Provident Fund” (smacking somewhat of a Ponzi scheme), it would probably have surpassed Switzerland at long last. Despite this strange habit of the government, it does rank high for both economic and political stability still.
Like Dubai, Singapore does not levy taxes, duties, or customs restrictions on either exporting or importing precious metals bullion coins and bars. They do require you to fill in a GST Goods and Service Tax exemption permit when you enter the Red Channel checkpoints on arriving in the city state. Still, with no capital gains or sales taxes here, premiums on the various precious metals products are reasonable. Hong Kong is still cheaper though. The SPMX Singapore Precious Metals Exchange proves to be the second biggest precious metals trading center for Asia (following only Hong Kong). You have also seen a number of precious metals refiners, bailment, and logistics firms open up facilities here.
You do not have to be a victim to Singapore’s high property prices either. Malaysia is minutes away (via modern road, train, and air links) where the costs of living are embarrassingly cheap.
It would be understandable if you raised your eyebrows upon reading that Panama is in the fourth safest jurisdiction for storage of precious metals. The truth is that a lot of the nations in Central America are in this category to one degree or another. This is partly the inevitable result of inept governments and customs rules which are at best poorly understood and enforced at the borders. Most have low or no capital gains taxes like Panama too.
For Latin America, Panama represents the most advanced gold buying, selling, and storage option. You have several good choices for non-bank safe deposit box storage and also local buy-backs and sales of gold and the other metals. The Panana Pacifico “special business district” is both tax exempt and duty-free as well. There may be a seven percent import tax, but a local customs broker can help you to get around this annoyance.
We are sure that you will love their world class infrastructure (American-built and substantially newer than America’s too), near-perfect climate, and multi-cultured and highly exciting capital city of the same name. Large American and British expat communities only encourage the party while the United States is so very close to Panama by air. The downside is that the country has never been the best example for political stability, yet the Noriega years are only a distant memory today. Prices for real estate are fair but not yet expensive here as they have become in neighboring expat haven Costa Rica.
#5 Hong Kong
Hong Kong used to rank number two on lists such as these until China took it over from the far more dependable British administration. The honest truth is that the Chinese overlords are a serious wildcard for the territory’s future. Property prices too are off the charts today, which diminishes the appeal of becoming international here.
Yet the precious metals dealers boast the most competitive bid and ask spreads, and storage options are many and excellent. It only costs a mere couple of dollars over spot to purchase investment grade gold coins in Hong Kong. Many times you can sell your purchases for more than the spot prices too.
Taxes do not apply to bullion coins and bars which you declare to be for your personal use. They also do not levy export or import duties on the precious metals. As the top-rated Asian (and also a truly global) hub for vaulting and bailment services, Hong Kong still represents an excellent choice for domiciling both your valuables and yourself.
Germany makes the list despite being a Euro Zone nation primarily because it does not levy any capital gains taxes on silver and gold holdings. Non-EU silver coins escape from the steep 19 percent VAT tax as well. Gold and silver coin shops abound in every city and town throughout Germany too, meaning that availability and liquidity both rank extremely high here. The very word that stands for money in Germany is “geld,” or gold.
You can also still purchase favorably located residential properties in the major cities for far less than other popular EU destinations such as London, Paris, Vienna, Zurich, and Rome. An added bonus for storage considerations is that Switzerland, Liechtenstein, and Austria are all just across the German borders. Without a doubt, Germany remains the safest and most politically and economically stable state in the Euro Zone. The quality of life is extremely high and the healthcare is among the best on earth.