The UAE has topped a new ranking of countries with the world’s most favourable tax conditions.

The comprehensive index assessed 48 countries and was produced by Global Citizen Solutions (GCS), an international consultancy specialising in residency and citizenship planning.

The report, titled “Tax Optimisation for Global Citizens”, was compiled by the GCS Global Intelligence Unit and ranked the UAE first.

Each country was assessed against 11 key indicators grouped into three categories: tax burden, weighted at 42.5 per cent; tax structure, also weighted at 42.5 per cent; and investment migration, weighted at 15 per cent.

The UAE secured the top position due to its absence of personal income tax, 5 per cent value-added tax and lack of exit taxes for departing residents.

The UAE has also ranked highly for healthcare, safety, security and overall quality of life in similar reports previously published by international think tanks.

Hong Kong, Paraguay, the Bahamas, and Antigua and Barbuda also ranked among the top five.

Malta and Cyprus were the only European countries in the top 10. Their positions were driven primarily by preferential tax regimes rather than simply low headline tax rates.

One of the study’s key findings was that a country’s tax rates and the structure of its tax system are largely independent of one another.

For example, despite having a tax rate of 36 per cent, closer to those of many Western European countries than Caribbean nations, Uruguay achieved the highest tax structure score of all countries assessed. This helped it rank 12th overall.

The report also identified the United States as having the heaviest tax burden.

According to the study, the US also imposes the most stringent exit-tax rules of all the countries assessed.