A new EU list of non-cooperative jurisdictions for tax purposes (the “EU Blacklist”) was validated at the recent gathering of the Economic and Financial Affairs Council (ECOFIN) held on 5 December 2017.
In a bid to combat tax malpractices around the globe, EU State Members devised a screening process which includes an assessment of 92 jurisdictions based on tax transparency, fair taxation and the implementation of BEPS measures.
The new EU Blacklist comprises of the following countries:
1. American Samoa
2. Bahrain
3. Barbados
4. Grenada
5. Guam
6. Korea (Republic of)
7. Macao SAR
8. Marshall Islands
9. Mongolia
10. Namibia
11. Palau
12. Panama
13. Saint Lucia
14. Samoa
15. Trinidad and Tobago
16. Tunisia
17. United Arab Emirates
Another list was drawn by the EU in respect of the countries which have committed to implement tax good governance principles within a certain timeframe i.e. by 2018 for most countries and by 2019 for developing countries.
The countries have been grouped under the different sets of criteria:
1. Transparency:
Curaçao, Hong Kong SAR, New Caledonia, Oman, Qatar, Taiwan, Turkey, Bosnia and Herzegovina, Cabo Verde, Fiji, Jordan, Montenegro, Serbia, Swaziland, Vietnam, Armenia, Botswana, Former Yugoslav Republic of Macedonia, Jamaica, Maldives, Morocco, Peru, Thailand.
2. Fair taxation:
Andorra, Armenia, Aruba, Belize, Botswana, Cabo Verde, Cook Islands, Curacao, Fiji, Hong Kong SAR, Jordan, Liechtenstein, Maldives, Mauritius, Morocco, Saint Vincent and the Grenadines, San Marino, Seychelles, Switzerland, Taiwan, Thailand, Turkey, Uruguay, Vietnam, Malaysia, Labuan Island, Bermuda, Cayman Islands, Guernsey, Isle of Man, Jersey and Vanuatu.
Although Mauritius appears in the above list, it has nevertheless committed to amend or abolish any harmful tax regimes that has been identified by the EU, by 2018.
3. Anti-BEPS measures:
Aruba, Cook Islands, Faroe Islands, Greenland, New Caledonia, Saint Vincent and the Grenadines, Taiwan, Vanuatu, Albania, Armenia, Bosnia and Herzegovina, Cabo Verde, Fiji, Former Yugoslav Republic of Macedonia, Jordan, Maldives, Montenegro, Morocco, Serbia and Swaziland, Nauru, Niue.
In the wake of the “Paradise Papers”, that slammed the transparency of well-established International Financial Centres including Mauritius, it is important to note that the island nation has not been included on the EU Blacklist and is committed to eradicating any tax practices that have been flagged as inappropriate by the EU. The Mauritian economy rests on a sound regulatory framework and it has always adhered to international standards of transparency and exchange of information. In fact, earlier this year Mauritius was rated “Compliant” by the Global Forum on Transparency and Exchange of Information for Tax Purposes. Indubitably, the credibility of Mauritius as a jurisdiction of substance cannot be challenged. To access the full outcome of the proceeds of the ECOFIN gathering held on 5 December 2017, please click Here.
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