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Countries With Zero Income Taxes

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Saudi Arabia

Saudi Arabia, the world's number one oil exporter, doesn't impose a tax on salaries, but self-employed expats are taxed at a rate of 20 percent.

Saudi employees make a contribution of 9 percent of their income for social security benefits, while employers add another 9 percent. Other notable taxes include a capital gains tax of 20 percent. Petroleum is the major source of funding for the government, accounting for about 75 percent of budget revenues, 45 percent of GDP and 90 percent of export earnings, according to OPEC.

The country's vast oil wealth has been a big draw for foreigners with more than one third of the population being foreigners. Private companies have also been able to capitalize on the growing number of workers from South or Southeast Asia, because they command lower wages than locals. The government estimates that roughly nine in 10 employees in private companies are expatriates. In response to this, the government has started introducing measures to lower unemployment among its citizens. For example, from last November, private companies with majorities of foreign workers are required to pay a fee of $640 a year for each excess foreigner, Reuters reported.

Aldo Pavan | Lonely Planet | Getty Images