EU blacklist names 17 tax havens and puts Caymans and Jersey on notice

Friday, 8 December 2017 00:00 - - {{hitsCtrl.values.hits}}

Brussels identifies 17 countries including South Korea, Barbados, Panama and UAE with 47 others such as the Isle of Man and Bermuda warned

The EU has named and shamed 17 countries in its first ever tax haven blacklist and put a further 47 on notice, including British overseas territories and the crown dependencies of Jersey, Guernsey and the Isle of Man, in an attempt to clamp down on the estimated £ 506 b lost to aggressive avoidance every year.

The move was hailed as a vital “first step” but the failure of the member states to agree on any sanctions for those on the blacklist provoked the European commissioner for economic and financial affairs, Pierre Moscovici, to concede it was as yet “an insufficient response”.

The blacklist includes South Korea, Mongolia, Namibia, Panama, Trinidad & Tobago, Bahrain and the United Arab Emirates.

Guam, the US territory in the Pacific, also features on the blacklist, in a move that is unlikely to endear Brussels to Donald Trump’s White House.

The EU said the countries failed to match up to international standards and had not offered sufficient commitments that they would change their ways during talks in the months leading up to publication of the list.

Of the jurisdictions with links to the UK – Bermuda and the Cayman Islands, along with Guernsey, Jersey and the Isle of Man – have been placed on a so-called “grey list” who have committed to reform their tax structures to ensure, for example, that firms are not simply using their 0% corporate tax rates to shield their profits.

It is understood the British government tried and failed to ensure those jurisdictions would not be screened by the EU’s tax experts but was overruled. A further eight jurisdictions affected by recent hurricanes will be addressed in February. Namibia was the only country on the blacklist who made no effort at all to correspond with the EU’s tax experts on the European council’s code of conduct (COC) group when issues were raised with the country’s government.

The others on the blacklist are: American Samoa, Barbados, Grenada, Macau, the Marshall Islands, Palau, St Lucia, Samoa and Tunisia.

The blacklist will be linked to EU legislation so that jurisdictions implicated will not be eligible for funds from the bloc except where it is to aid development. (Source: www.theguardian.com)