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EU Adds Cayman Isles, Panama, Seychelles To Tax Blacklist

by Ulrika Lomas,, Brussels

20 February 2020

The EU has added the Cayman Islands, Palau, Panama, and the Seychelles to its list of non-cooperative tax jurisdictions, bringing the total tally to 12 from 8.

On February 18, the European Council agreed the additions, stating that these jurisdictions had failed to implement the tax reforms they had committed to by the agreed deadline.

The Council has also amended its "grey list", of jurisdictions cooperating with the EU to amend their tax systems. In light of their implementation of reforms in compliance with EU tax good governance principles within the required timeframe, the following jurisdictions have been removed from the grey list: Antigua and Barbuda, Armenia, the Bahamas, Barbados, Belize, Bermuda, the British Virgin Islands, Cabo Verde, the Cook Islands, Curacao, the Marshall Islands, Montenegro, Nauru, Saint Kitts and Nevis, and Vietnam.

The EU has granted 12 jurisdictions extensions to enable them to pass the necessary reforms and deliver on their commitments. The EU said that most of the deadline extensions concern developing countries without a financial center who have already made meaningful progress in the delivery of their commitments.

Most commitments delivered upon by third-country jurisdictions involved a deadline of the end of 2019.

Zdravko Maric, Minister of Finance for Croatia, which currently holds the rotating Council Presidency, said: "The work on the list of non-cooperative tax jurisdictions is based on a thorough process of assessment, monitoring, and dialogue with about 70 third-country jurisdictions. Since we started this exercise, 49 countries have implemented the necessary tax reforms to comply with the EU's criteria. This is an undeniable success. But it is also work in progress and a dynamic process where our methodology and criteria are constantly reviewed."

In December 2019, the Council produced guidance on further coordination of national defensive measures in the tax area towards non-cooperative jurisdictions. It invited EU member states to apply legislative defensive measures vis-a-vis the listed jurisdictions as of January 1, 2020. The aim is to encourage those jurisdictions to comply with the Code of Conduct screening criteria on fair taxation and transparency.

The list was first established in December 2017. The 'blacklist' now contains the following jurisdictions: American Samoa, the Cayman Islands, Fiji, Guam, Oman, Palau, Panama, Samoa, the Seychelles, Trinidad and Tobago, the US Virgin Islands, and Vanuatu.

TAGS: Nauru | compliance | tax | business | tax compliance | Bahamas | tax avoidance | Armenia | Belize | Bermuda | Cayman Islands | Cook Islands | Fiji | Marshall Islands | Samoa | Trinidad and Tobago | Vanuatu | Virgin Islands | Montenegro | transfer pricing | American Samoa | Antigua and Barbuda | Palau | Saint Kitts and Nevis | United States | tax reform | European Union (EU) | Barbados | British Virgin Islands | Croatia | Guam | Oman | Panama | Seychelles | Vietnam | Europe | Tax | Tax Evasion | BEPS

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