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I believe this has huge implications for someone who would want to operate a company from a business friendly country, as opposed to say a country where the ind

I believe this has huge implications for someone who would want to operate a company from a business friendly country, as opposed to say a country where the individual is located physically but is otherwise corrupt or war ridden. My understanding is that this status allows you to form companies, open bank accounts and sign binding documents just like someone living in Estonia. And that is pretty impressive. Add cryptocurrencies into play, and whole new world of companies is now suddenly possible.

boh 12y ago
"Money laundering has never been so easy! Thanks E-stonia!"
- cpach 12y ago
  So money laundering is the only reason for using cryptocurrencies? And who says cryptocurrencies can’t be regulated?
  - boh 12y ago
    Shell companies are one of the greatest instruments for graft ever devised. I'm not a fan of them, and they get easier to make with every passing year. I don't have an opinion on cryptocurrencies. I'm sorry if it seemed that way.
    - cpach 12y ago
      Yes, there is a hazard in this. But probably also lots of utility for benign causes. So I hope they will outweigh the malicious ones.
  - zanny 12y ago
    I'm curious how you launder money in bitcoin. If you know that some btc was used for a "criminal" exchange, then you can track all the Satoshis through all their recipients. You can just blacklist the money in your country and any retailer using your blacklists would not accept it.
    - cpach 12y ago
      One example how it can be done: https://news.ycombinator.com/item?id=8130592 https://news.ycombinator.com/item?id=8130592
      - zanny 12y ago
        I mean in a bitcoin economy. The only reason that example works is because the input fiat does not have the transparency of a blockchain behind it. If you were end to end using bitcoin, ie, drug dealer gets paid in bitcoin, then if you know its drug money you can blacklist it forever because its always traceable.
        cpach 12y ago
        There are ways around that: https://en.bitcoin.it/wiki/Mixing_service https://en.bitcoin.it/wiki/Mixing_service
- kteofanidis 12y ago
  From the website: To apply for one, you need to make visit a Police and Border Guard office in Estonia – there you need to submit an application and provide biometrical data (your facial image and fingerprints) for background check. I don't think it works for money laundering in any way.
agilebyte 12y ago
It is to use Estonia's digital services and does not give you residency. Nothing stops you opening a company in Estonia now, but that does not mean you would only pay corporation taxes there (they are at 10% when distributed as dividends), your physical location plays a role too.
- deleted 12y ago
  [deleted]
- imeikas 12y ago
  Dividends are taxed this year at 21%. And if I'm not mistaken tax rate is lowered to 20% next year, reinvested profit is not taxed.
  - agilebyte 12y ago
    You are right, don't know where I got that 10% from.
    - kteofanidis 12y ago
      Bulgaria has a corporate tax at 10%. The e-government isn't nearly as developed though. There was some talk about using the Estonian experience to help in building ours but that is still just an idea.
      - agilebyte 12y ago
        Yeah I am really hoping that Bulgaria and/or Estonia will be added to a list of countries being incorporated by http://startupr.com/ http://startupr.com/ to make the process easier.
    - deleted 12y ago
      [deleted]
- wiradikusuma 12y ago
  Can you work for your own Estonian company, given that you're non-resident? (You can start your own US company, even remotely, but you can't work for it, unless you have Working Visa)
pdabbadabba 12y ago
I agree this is interesting, but the problem is that there is nothing to stop the government of the country in which you physically reside from having different ideas about what laws govern your dealings. If the country you are physically in wants to (e.g.) tax you, they can. (There are, of course, many more nefarious possibilities than taxation.) This is, I think, true in an "in accordance with international law" sense (though there is the possibility that a bilateral double taxation treaty might apply) and it is certainly true in a "who's to stop them" sense. (And if we're hypothesizing that the person is physically located in a corrupt/war torn country, the latter would probably be all that matters anyway.)
- tjbiddle 12y ago
  Can they though? If all of the money is kept in Estonia for example, and none actually goes through your identity or a business elsewhere - then that company wouldn't have any right to it from my understanding. Until you pay someone in another country - then the other one can't dip their hand in it. Isn't this why so many companies are based out of random countries to begin with?
  - aragot 12y ago
    It's hard to spend money that is hidden from local tax offices. Local authorities can even blame you if your lifestyle is higher than your declared income.

boh 12y ago

"Money laundering has never been so easy! Thanks E-stonia!"

cpach 12y ago
So money laundering is the only reason for using cryptocurrencies? And who says cryptocurrencies can’t be regulated?
- boh 12y ago
  Shell companies are one of the greatest instruments for graft ever devised. I'm not a fan of them, and they get easier to make with every passing year. I don't have an opinion on cryptocurrencies. I'm sorry if it seemed that way.
  - cpach 12y ago
    Yes, there is a hazard in this. But probably also lots of utility for benign causes. So I hope they will outweigh the malicious ones.
- zanny 12y ago
  I'm curious how you launder money in bitcoin. If you know that some btc was used for a "criminal" exchange, then you can track all the Satoshis through all their recipients. You can just blacklist the money in your country and any retailer using your blacklists would not accept it.
  - cpach 12y ago
    One example how it can be done: https://news.ycombinator.com/item?id=8130592 https://news.ycombinator.com/item?id=8130592
    - zanny 12y ago
      I mean in a bitcoin economy. The only reason that example works is because the input fiat does not have the transparency of a blockchain behind it. If you were end to end using bitcoin, ie, drug dealer gets paid in bitcoin, then if you know its drug money you can blacklist it forever because its always traceable.
      - cpach 12y ago
        There are ways around that: https://en.bitcoin.it/wiki/Mixing_service https://en.bitcoin.it/wiki/Mixing_service
kteofanidis 12y ago
From the website: To apply for one, you need to make visit a Police and Border Guard office in Estonia – there you need to submit an application and provide biometrical data (your facial image and fingerprints) for background check. I don't think it works for money laundering in any way.

agilebyte 12y ago

It is to use Estonia's digital services and does not give you residency. Nothing stops you opening a company in Estonia now, but that does not mean you would only pay corporation taxes there (they are at 10% when distributed as dividends), your physical location plays a role too.

deleted 12y ago
[deleted]
imeikas 12y ago
Dividends are taxed this year at 21%. And if I'm not mistaken tax rate is lowered to 20% next year, reinvested profit is not taxed.
- agilebyte 12y ago
  You are right, don't know where I got that 10% from.
  - kteofanidis 12y ago
    Bulgaria has a corporate tax at 10%. The e-government isn't nearly as developed though. There was some talk about using the Estonian experience to help in building ours but that is still just an idea.
    - agilebyte 12y ago
      Yeah I am really hoping that Bulgaria and/or Estonia will be added to a list of countries being incorporated by http://startupr.com/ http://startupr.com/ to make the process easier.
  - deleted 12y ago
    [deleted]
wiradikusuma 12y ago
Can you work for your own Estonian company, given that you're non-resident? (You can start your own US company, even remotely, but you can't work for it, unless you have Working Visa)

pdabbadabba 12y ago

I agree this is interesting, but the problem is that there is nothing to stop the government of the country in which you physically reside from having different ideas about what laws govern your dealings. If the country you are physically in wants to (e.g.) tax you, they can. (There are, of course, many more nefarious possibilities than taxation.) This is, I think, true in an "in accordance with international law" sense (though there is the possibility that a bilateral double taxation treaty might apply) and it is certainly true in a "who's to stop them" sense. (And if we're hypothesizing that the person is physically located in a corrupt/war torn country, the latter would probably be all that matters anyway.)

tjbiddle 12y ago
Can they though? If all of the money is kept in Estonia for example, and none actually goes through your identity or a business elsewhere - then that company wouldn't have any right to it from my understanding. Until you pay someone in another country - then the other one can't dip their hand in it. Isn't this why so many companies are based out of random countries to begin with?
- aragot 12y ago
  It's hard to spend money that is hidden from local tax offices. Local authorities can even blame you if your lifestyle is higher than your declared income.