Fair taxation: Member States update EU list of non-cooperative tax jurisdictions

EU Member States today added three jurisdictions – Anguilla, Bahamas and Turks and Caicos – to the EU list of non-cooperative jurisdictions for tax purposes. All three jurisdictions were added to Annex I (so called “EU list”) because they have failed to enforce the economic substance requirements that apply to zero tax jurisdictions. Today’s update takes the number of jurisdictions on the EU list to 12: American Samoa, Anguilla, Bahamas, Fiji, Guam, Palau, Panama, Samoa, Trinidad and Tobago, Turks and Caicos, US Virgin Islands, and Vanuatu. Under the EU listing process, jurisdictions are assessed against three main criteria – tax transparency, fair taxation and the implementation of the Base Erosion and Profit Shifting (BEPS) minimum standards. Jurisdictions with identified deficiencies under the criteria of the EU list are asked to commit at high political level to addressing the deficiencies within a set deadline. Those jurisdictions that refuse to cooperate are directly added to the EU list. Those jurisdictions that take a formal commitment to address the deficiencies within the set deadline are included in a separate Annex (so called Annex II) and are being closely monitored to ensure that they complete their reform in line with the commitment taken. The Commission is also working with Member States to strengthen the EU list’s criteria to ensure more tax transparency in particular in the area of beneficial ownership information, a more refined approach to economic substance requirements, and to promote global implementation of the minimum level of taxation under Pillar 2. More information is available here.