Import/Export Trading Company Package

RE-BILLING PROCEDURES FOR IMPORTERS AND EXPORTERS

Re-Billing Procedure For Exporters

Suppose Spanish exporter (a) sells to Hong Kong importer (b) at $100. And suppose the exporter is running a very profitable business. His taxes in Spain will be very high.

In order to reduce the amount he would need to pay in taxes, the exporter could make the profit in Gibraltar rather than in Spain. The system he would use would work as follows :

Instead of billing directly to Hong Kong at $100, he would bill to a Gibraltar Company at $90. This will reduce his income in Spain by $10 or 10% of his Gross Sales. Very few companies make a profit equal to 10% of Sales. So that under-billing will probably wipe out his profit entirely. Of course the amount billed to Gibraltar can be anything: $90, $95, or whatever the figure required to result in Zero tax payable in Spain.