7 December 2017

Tax havens: the EU blacklist is a major step forward

On 5 December, the European Union (EU) published a blacklist of 17 tax havens for which the principle of sanctions is being debated, as well as a grey list of 47 countries who are being watched closely. France hails this list as a major step forward in the crackdown against tax avoidance.
It is the first time in the EU's history that it has published such a document. To date, only 18 member states, France among them, had a list. The OECD's list only contained one name: Trinity and Tobago.
The Government is fully determined to do everything necessary to crack down on tax avoidance. For it is unacceptable that some citizens actively seek to avoid paying taxes, when, as Bruno Le Maire, Minister of Economy and Finance, reminded, "tax avoidance undermines popular consent to taxation."
The EU blacklist contains 17 States ("non-cooperative jurisdictions"): American Samoa, Bahrain, Barbados, Grenada, Guam, Macao, Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, South Korea, Trinidad and Tobago, Tunisia and United Arab Emirates.
It has been drawn up by an expert group who examined 92 States in light of 3 criteria:
  • Tax transparency: do they practise Automatic Exchange of Information?
  • Fair taxation: do they implement preferential tax measures that could be regarded as excessive?
  • Do they implement the OECD anti-tax base erosion and profit shifting (BEPS) measures
The grey list contains 47 States who have been put on notice as regards the commitments they have made to meeting these criteria (for example: Switzerland, Morocco, the Cayman Islands and Cabo Verde).
These lists are not set in stone. They will be reviewed at regular intervals and updated in the years to come. Some States will be taken off them, while others will be added.
The next step is to define what type of sanctions are to be applied to countries on the blacklist. France has suggested that the financial assistance they are granted through European or international programmes depend upon their progress in the crackdown against tax avoidance.

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