Monaco
The Economy of Monaco
Monaco, which lies on the French coast of the Mediterranean Sea, is a popular resort, attracting tourists to its casino and pleasant climate. The country has a customs union with France and its currency is interchangeable with the French. Excise, stamp, transfer, and estate taxes are important sources of state revenue. Standard of living is high, roughly comparable to those in prosperous French metropolitan areas. Monaco does not publish national income figures.
The Principality or Princedom has successfully sought to diversify into services and small, high-value-added, nonpolluting industries. The state has no income tax and low business taxes and thrives as a tax haven both for individuals who have established residence and for foreign companies that have set up businesses and offices. The state retains monopolies in a number of sectors including tobacco, the telephone network, and the postal service. The gambling casino, contrary to popular belief, is managed as a concession by a private corporation which accounts for only a small portion of government revenue, although it contributes greatly to the economy by attracting tourists. In addition to tourism and the foreign businesses attracted to Monaco by low corporate taxes, shipping and the manufacture of perfumes, pharmaceuticals, processed food, and precision instruments are also important.
