by Julie Martin, MNE Tax
The EU’s Economic and Financial Affairs Council (ECOFIN) today updated the EU’s list of non-cooperative jurisdictions in taxation matters to reflect progress made by Liechtenstein, Peru, and Palau.
The Council removed Liechtenstein and Peru from its “grey” list, comprised of countries that do not meet the EU requirements for tax cooperation but that have pledged to change their rules. These two countries are now deemed compliant with all EU tax standards.
“Liechtenstein and Peru have completed the necessary reforms to comply with all the tax good governance principles identified at EU level and set out in the conclusions adopted by the Council in December 2017. As a consequence, the two countries will be removed from annex II of the conclusions,” a Council announcement said.
Liechtenstein had been placed on the greylist because it had one or more harmful tax regimes; Peru was on the list because it had failed EU tax transparency standards.
The ECOFIN also dropped Palau from the blacklist of non-cooperative tax jurisdictions and put the country on the graylist.
Palau has made commitments at a high political level to remedy EU concerns, the ECOFIN statement said. Palau implementation of its commitments will be carefully monitored by the EU Code of Conduct Group for business taxation.
Palau has been placed on the EU black and grey lists on account of having at least one harmful tax regime which facilitates offshore structures that attract profit without real economic activity.
Six jurisdictions remain on the EU tax blacklist of non-cooperative jurisdictions after today’s actions: American Samoa, Guam, Namibia, Samoa, Trinidad and Tobago, and the US Virgin Islands. Many more countries are on the gray list, having tax systems that are contrary to EU standards but that have committed to change their ways.
The ECOFIN Council has provided some countermeasures to encourage countries placed on the blacklist of tax havens to change their behavior.
Julie Martin
Julie Martin is the founder of MNE Tax. She edits the publication and regularly contributes articles on new developments in cross-border business taxation.
Julie has worked as a tax journalist and editor for more than 13 years. Prior to that, she worked as an in-house tax attorney in New York. She also holds an LLM in taxation from New York University School of Law.
Julie can be reached at [email protected].
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