By Francesca Amaddeo, Lecturer-Researcher, Tax Law Competence Centre (SUPSI), Manno, Switzerland
As of 22 February, the EU list of non-cooperative jurisdictions for tax purposes encompasses twelve countries: American Samoa, Anguilla, Fiji, Guam, Palau, Panama, Samoa, Trinidad and Tobago, US Virgin Islands, Vanuatu, Seychelles, and the newest entry, Dominica.
The reason for the listing is because these countries have failed to engage in a constructive dialogue with the EU on tax governance or have not met their commitments to the EU regarding tax transparency, fair taxation, or implementation of international tax standards.
To avoid tax blacklisting, countries must also receive a “largely compliant” rating from the Global Forum concerning the exchange of information on request.
Barbados was on the EU blacklist since October 2020 after receiving a ‘partially compliant’ rating from the Global Forum. The Global Forum has recently granted Barbados a supplementary review. Therefore, as of 22 February, Barbados has been removed from the blacklist and placed on the second step of the podium, the so-called “gray list.”
This grey list is comprised of countries that have made sufficient commitments to implement tax good governance principles but are not yet fully compliant
Jamaica is on the gray list since it has promised to abolish, or at least amend, its harmful tax regime by the end of 2022.
Australia, Jordan, and the Maldives benefit from an extension to the deadline to comply with their commitments.
Turkey’s status has been discussed: actually, Turkey is expected to solve all open issues in terms of the exchange of information with all Member States by 31 May 2021.
Botswana, Eswatini, and Thailand complete the grey list, while Morocco, Namibia, and Saint Lucia have been promoted off all lists, having met their commitments.
Remarks
Leaving aside the EU Parliament criticism regarding the assessment of criteria used by the Code of Conduct Group, these lists play a strong role in the EU context.
“Effective and proportionate defensive measures, in both non-tax and tax areas could be applied by the EU and member states vis-à-vis the non-cooperative jurisdictions, as long as they are part of such list”, the Council concluded on 5 December 2017, endorsing for the first time the list.
Member States are encouraged to take specific measures against non-cooperative jurisdictions both in tax-related issues and non-tax areas.
It follows that several countries, such as Luxembourg, have implemented national measures, whose application is based, among other criteria, on this list.
It will be interesting to see the consequences of any future changes to the blacklist criteria, as called for by the EU Parliament.
Francesca Amaddeo
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