Introduction According to Prosser & Murray (2010), “tax avoidance” is the legitimate use of the taxation system to decrease the amount of tax payable within a regulatory framework. Tax avoidance should be distinguished from tax mitigation, which is generally used by tax advisers as an unconventional derogatory to tax avoidance. This is a critical provision as it interferes with the economic growth of a country as well as international relations. Tax mitigation has also been used extensively in the tax regulations of certain dominions to differentiate tax avoidance (forecasted by the policymakers) from those that take advantage of the loopholes existing in the current regulatory framework (Bartelsman & Beetsma 2000). According to Mainland China’s Supreme Court, the legitimate right of a person to reduce the sum of what would otherwise be his/her taxes or completely avoids them cannot be questioned. Another term that is common in relation to taxes is tax evasion. Tax avoidance and evasion are means of tax noncompliance since they designate several activities that are not appropriate to a county’s taxation system (Bracewell-milnes, 1980). In this essay, some of the worldwide tax avoidance strategies are discussed in regard to the UK and Hong Kong. It is vital to establish whether this is a new phenomenon or a reaction to the policy document signed in June 2010 and a draft consultation framework of December 2010, which was suggested by a coalition government (Siriwardana & Schulze 2000). The relationship between Hong Kong and Mainland China For the past decades, Hong Kong has been a Special Administrative Region (SAR) of the people of the Republic of China. It is evident that the mini-constitution created by the Chinese government provides Hong Kong its sole legislation, economic independence, and credible/trusted judicial systems (Braithwaite, 2003). . In this context, it is vital to note that Beijing has been bestowed with the responsibility to deal with the defense and foreign affairs of China. A critical relationship between Hong Kong and mainland China is the basic constitutional provisions regarding the establishment of the Hong Kong SAR vividly setting out the legal frameworks of the Chinese government on Hong Kong. This also regards how SAR should be administered in diverse contexts. The aspects of tax avoidance in Hong Kong and mainland China are evident in regard to double taxation laws signed by both jurisdictions. Majorly, Hong Kong is a trading center within the Chinese territory. It also serves as a service center within the region. The region has limited natural resources compared to mainland China. This demonstrates the relationship (both legal and economic) that exists between Hong Kong and Mainland China. Additionally, Hong Kong executes its independent international trade affairs; however, it has maintained its border controls, custom procedures, and international trade provisions with China. Agreement to Avoid – “Double Tax” Hong Kong had no double taxation provisions until 2001. This provision obviated the global double taxation treaties that existed before. Under the provisions of “territorial principle,” the country realized the significance o