# Micronesia

 Country code: FM · Currency: USD · Language: English

**Pros**
- Absence of federal personal income tax and competitive corporate tax rates for business entities.
- High levels of personal safety and low crime rates within a stable Pacific environment.
- Minimal state interference in private affairs and strong protection of basic civil liberties.

**Cons**
- Property rights limitations due to constitutional prohibitions on land ownership for non-citizens.
- Severe infrastructure deficiencies regarding electrical stability and limited high-speed internet connectivity.
- High economic reliance on foreign subsidies and restricted local market size for business scaling.

Long story short: At the bar in Kolonia, they'll warn you fast: no foreigner ever owns land here, the Constitution bans it outright, only long-term leases exist.

The upside: taxes stay light, admin is basically a ghost, corruption shows up as clan-based favoritism rather than bribes, and crime is close to zero in the neighborhoods you'll actually live in.

Beyond that: the banking system is hanging by a thread since US banks cut correspondent ties, infrastructure is creaky, but local food is honest and Chuuk's underwater wrecks rank among the most stunning dive sites in the Pacific.

## Will your income be taxed?

Long story short: NO.
**Micronesia** doesn't tax personal income, and nobody comes sniffing around when you settle in. No withholding, no tax return, no centre-of-vital-interests trap waiting to snap shut.

Earn what you want: the taxman here simply doesn't know your name.

**01.1 Income tax**

| Metric | Value | Detail |
| --- | --- | --- |
| Personal income tax | NONE | no personal income tax framework |

**01.2 Tax residence test**

| Metric | Value | Detail |
| --- | --- | --- |
| 183-day rule | does not exist here |  |
| Economic interest | does not exist here |  |
| Family centre | does not exist here |  |
| Habitual abode | does not exist here |  |
| Extended-stay test | does not exist here |  |

## Will your wealth be taxed?

Long story short: NO.
**Micronesia** keeps its hands off what you hold. *No capital gains tax*, no annual wealth grab, no inheritance regime.

Your portfolio compounds in peace and leaves the way it came in; nobody's standing at the door with their palm out.

**02.1 Investment income**

| Metric | Value | Detail |
| --- | --- | --- |
| Capital gains | NONE | no capital gains regime |
| Dividend tax | NONE | no dividend tax |
| Interest income | NONE | no interest income tax |

**02.2 Wealth & estate**

| Metric | Value | Detail |
| --- | --- | --- |
| Wealth tax | NONE | no annual wealth tax · no real-estate wealth tax · no net-worth assessment |
| Inheritance system | NONE | no estate tax · no heir-based duties · no succession tax framework. Wealth transfers across heir-classes are not taxed in this jurisdiction. Only standard probate / registration fees may apply. |

**02.3 Crypto**

| Metric | Value | Detail |
| --- | --- | --- |
| Crypto · tax regime | ZERO TAX | Rate: 0% · The Federated States of Micronesia does not impose capital gains tax on individuals. Personal income tax is strictly limited to wages and salaries. Professional trading is classified as a business activity and is subject to Gross Revenue Tax (GRT) at a rate of 3% on gross receipts exceeding $10,000, rather than on net capital gains. |
| Crypto-to-crypto | NEUTRAL | a swap is not a taxable realisation event |
| FATF travel rule | NOT SIGNED | no information-sharing obligation on VASP transfers |

## Easy to run a company there?

Long story short: YES.
**Micronesia** is maximum operational chill: *no corporate income tax* on standard profits, *no criminal liability* for misuse of corporate assets, and *non-public* registries.

The state doesn't take a cut, doesn't park a prosecutor over your intra-company flows, and doesn't put your name in a search box.

VAT sits at **n/a**. Run your thing; nobody's looking over your shoulder.

**03.1 Rates**

| Metric | Value | Detail |
| --- | --- | --- |
| Corporate tax | NONE | no corporate income tax framework |
| VAT standard rate | NONE | no general VAT · no consumption tax framework |

**03.2 Regime & registry**

| Metric | Value | Detail |
| --- | --- | --- |
| IP Box · Patent Box | NONE | no IP regime · IP income taxed under standard corporate rules |
| Misuse of corporate assets | NO CRIMINAL | no criminal liability · The Federated States of Micronesia (FSM) follows a common law legal tradition (heavily influenced by U.S. law). Under this system, while a corporation is a separate legal entity, a sole shareholder-director who uses corporate funds for personal expenses while the company is solvent is generally not subject to criminal prosecution for theft or embezzlement. This is because the individual, as the sole person authorized to act for the corporation, is deemed to have consented to the transaction. Such actions are typically addressed as civil breaches of fiduciary duty under Title 36 of the FSM Code (Corporations) or as tax issues (e.g., constructive dividends), rather than criminal 'Misuse of Corporate Assets' (a concept primarily found in Civil Law jurisdictions like France). |
| Shareholders privacy | PRIVATE | Registrar of Corporations |
| Directors privacy | PRIVATE | Registrar of Corporations |

**03.3 Incorporation cost**

_In this country, the most standard company form is called Corporation (Business Corporation). The costs below are for incorporating a company in its simplest form, for reference only._

| Metric | Value | Detail |
| --- | --- | --- |
| FSM Registrar of Corporations Filing Fee (Articles of Incorporation) | USD 100 |  |
| Corporate Name Reservation Fee | USD 20 |  |
| Notarization of Incorporation Documents | USD 10 |  |
| Foreign Investment Permit (FIP) Application Fee | USD 250 |  |
| Initial State Business License Fee (Estimated) | USD 250 |  |
| Professional Incorporation and Legal Service Fees | USD 750 |  |
| Total | USD 1,380 |  |

## A good fit for a holding?

Long story short: NO.
**Micronesia** has no treaty network at all, which buries the holding question, full stop.

Every dividend in or out eats the statutory withholding at full rate, and no domestic regime can patch a hole that sits on the source side. Don't park a holding here.

**04.1 Substance & exemptions**

| Metric | Value | Detail |
| --- | --- | --- |
| Territorial · individuals | TERRITORIAL | territorial — foreign-source income generally untaxed |
| Territorial · corporates | WORLDWIDE | worldwide corporate taxation |
| Participation exemption | NONE | no dividend participation exemption regime |
| CFC rules | NONE | no controlled foreign corporation regime · foreign-source corporate income out of scope |

**04.2 Withholding tax · non-resident**

| Metric | Value | Detail |
| --- | --- | --- |
| WHT · dividends | NONE | no withholding on outbound dividends |
| WHT · interest | NONE | no withholding on outbound interest |
| WHT · royalties | NONE | no withholding on outbound royalties |
| Tax-haven WHT | NONE | no punitive rate on record |

**04.3 Treaty network**

| Metric | Value | Detail |
| --- | --- | --- |
| Treaties signed | 0 | active |
| Treaties pending | — | in negotiation |

## Easy to come and go?

Long story short: LITTLE.
Coming and going from **Micronesia** costs you nothing worth mentioning. *Territorial* regime (foreign income stays foreign), *no exit tax* at the door.

You show up with your stuff, you leave with your stuff, plus whatever you earned abroad in between. Borders the way they should all work.

**05.1 Exit & dual nationality**

| Metric | Value | Detail |
| --- | --- | --- |
| Exit tax | NONE | no triggers active · residence change tax-free · no deemed-disposal mechanism |
| Dual citizenship | FORBIDDEN | naturalisation requires renouncing existing citizenship |

**05.2 Citizenship paths**

| Metric | Value | Detail |
| --- | --- | --- |
| Residence | — | not available |
| Marriage | — | not available |
| Birth | — | not available |
| Descent | — | not available |
| Investment | — | not available |

## Is your money watched?

Long story short: NO.
Nobody's reading over your shoulder in **Micronesia**. It has joined *almost none* of the big automatic-exchange machines (CRS, FATCA, CARF, MLI, MAAC), and its corporate registries are *non-public*.

Your account movements stay out of foreign tax offices; your name stays out of search boxes. Here, discretion isn't a perk; it's the factory setting.

**Multilateral reporting frameworks — 1/9 active**

| Item | Status | Detail |
| --- | --- | --- |
| CRS | None | — |
| CARF | None | — |
| FATCA | None | — |
| MLI | None | — |
| BEPS | None | — |
| MAAC | None | — |
| GLOBAL FORUM | None | — |
| EOIR | In force | — |
| CRYPTO TRAVEL RULE | None | — |

## Is it blacklisted?

Long story short: NO.
**Micronesia** sits on no major blacklist, though it's *outside* the FATF club.

Some counterparties will run a bit of extra due diligence out of habit, but there's no formal stigma: you won't get hassled for dealing with it.

**Blacklist exposure — Clear everywhere**

| Item | Status | Detail |
| --- | --- | --- |
| EMBARGO | Clear | un / us / eu sanctions |
| FATF | Clear | grey / black list |
| EU | Clear | non-cooperative list |
| FRANCE | Clear | ETNC list |
| SPAIN | Clear | tax-haven list |
| PORTUGAL | Clear | favourable regimes |
| BRAZIL | Clear | low-tax list |

## Do you feel free there?

Long story short:
Not enough data to tell how free you'd actually feel in **Micronesia**.

**08.1 Press freedom**

| Metric | Value | Detail |
| --- | --- | --- |
| Press freedom · RSF index | — |  |

Central bank digital currency

NONE

no announced CBDC program · no pilot · no retail or wholesale prototype on record

## Connected to the world?

Long story short: POORLY CONNECTED.
The two rails that matter are both dead in **Micronesia**. *Stripe* won't onboard you, so card payments mean a foreign structure or a local processor with its own rules. *Amazon* doesn't deliver either.

Some secondary services run (**3/11**), but for an online business this is swimming against the current.

**Accept payments — 1/6 available**

| Item | Status | Detail |
| --- | --- | --- |
| Stripe | Not available | card payments |
| PayPal | Not available | wallet payments |
| Adyen | Not available | enterprise psp |
| Mollie | Not available | eu payments |
| GoCardless | Not available | direct debit |
| Paddle | Available | merchant of record |

**Bank and move money — 1/3 available**

| Item | Status | Detail |
| --- | --- | --- |
| Wise | Available | multi-currency |
| Revolut | Not available | personal banking |
| Revolut Business | Not available | business banking |

**Buy and sell on Amazon — 1/2 available**

| Item | Status | Detail |
| --- | --- | --- |
| Amazon | Not available | consumer delivery |
| Amazon Seller | Available | marketplace selling |

  SEE ALSO## Other jurisdictions worth comparing

Picked by similarity of strategic profile to Micronesia. No editorial ranking — neighbours in the same scoring space.

  PROFILE-ADJACENT Same shape, comparable overall friction.

 [   Vatican City VA  → ](https://stateless.sx/en/country/va) [   St. Barthélemy BL  → ](https://stateless.sx/en/country/bl) [   Wallis & Futuna WF  → ](https://stateless.sx/en/country/wf)

  NOTABLY MORE FAVORABLE Same family of strategies, higher total score.

 [   El Salvador SV  → ](https://stateless.sx/en/country/sv) [   Georgia GE  → ](https://stateless.sx/en/country/ge) [   Guatemala GT  → ](https://stateless.sx/en/country/gt)

  NOTABLY LESS FAVORABLE Same family of strategies, lower total score.

 [   Nicaragua NI  → ](https://stateless.sx/en/country/ni) [   Belarus BY  → ](https://stateless.sx/en/country/by) [   French Polynesia PF  → ](https://stateless.sx/en/country/pf)