Quite a few experts believe the new generations of free ports will be the solution for the development of various businesses that will be conducted in these “mini tax havens”. Free ports or free zones are areas with flexible jurisdiction compared to the country in which they are situated and have evolved as centers for commercial and manufacturing exchange.
The new generation of free ports is usually built near airports and focuses on storing small, portable and high value goods, such as gold ingots, antique art, documents, and microchips, among others. The best definition for understanding how the new ports work would be to think of a traditional bank deposit; but instead of bank vaults, they are free zones, and you will thus use them as best suit your needs without having to declare it to customs.
From a fiscal point of view, free ports fall under “no man’s land”. The "free" part refers to suspending customs duties and paying tax. Many of the goods stored in these ports remain there for decades without this causing a problem or attracting the eyes of investigators. In addition, sales of goods at free ports do not include value added tax or taxes on capital gains. These goods are technically payable in the destination country when the item leaves this so-called “parallel fiscal universe”.
One of the main advantages of free ports is the possibility of doing business that they offer: selling, buying and exchanging goods. Free port operators have been wise enough to understand that there is a big demand. Several facilities have been created at these free ports, and telecommunications services are usually excellent.
One of the best known examples in the world is the Free Trade Zone of Colón, Panama, at the end of the Panama Canal where goods can be freely unloaded in the free zone without passing through Panamanian customs. These goods can be traded and loaded directly onto ships or transferred to the Tocumen International Airport for export.
While Colón is only used for exchanging, other free zones are used for manufacturing. Nearly 70% of exports from the Dominican Republic, especially textiles, are manufactured in areas like this This was possible because that country’s government allowed a law so that free zones would also operate as financial centers.
Most analysts consider that while borders will be increasingly less important in the future, more businesses may be conducted in “parallel fiscal universes”, and in light of this reality, it is possible to predict that more free ports will be built all over the world. This will create a network linked by air routes thus providing international business with a better outlet.