European Union ministers remove Panama and 7 others from tax haven blacklist

Rodiano Bonacci
Gennaio 23, 2018

The EU removed eight countries including Panama from its new tax haven blacklist on Tuesday after they pledged to address its concerns, in a move swiftly condemned by activists.

Barbados, Grenada, South Korea, Macao, Mongolia, Tunisia and the United Arab Emirates joined Panama as jurisdictions delisted. Nevertheless, it sparked a protest from some campaign organisations, some of which cited the fact that Panama had featured prominently in the "Panama Papers" expose in 2016 as a reason to keep it off limits to the world's mainstream financial community.

The decision leaves nine countries on the list of "non-cooperative jurisdictions" - American Samoa, Bahrain, Guam, Marshall Islands, Namibia, Palau, Saint Lucia, Samoa and Trinidad and Tobago.

"Jurisdictions around the world have worked hard to make commitments to reform their tax policies", said Vladislav Goranov, minister for finance of Bulgaria, which now holds the Council of the EU's presidency. It noted that these commitments were backed by letters signed at a high political level.

He insisted that the EU's aim was to make offshore tax schemes "a thing of the past". The lists followed the recent Panama Papers and Paradise Papers leaks.

Whereas the list is to be revised at least once a year, the working group responsible for preparing it (the "code of conduct group") can recommend an update at any time.

At the time the list was unveiled in December, some critics argued that it was incomplete, as it left out a number of jurisdictions seen to be tax evasion facilitators, including Luxembourg and Malta.

Chardonnet said it was "no secret that tax havens remain at the heart of the EU, with four European countries actually failing the EU's own blacklisting criteria".

"The EU is rushing to take countries off the blacklist without it being clear what they have actually committed to improve; this is further undermining the process", said Aurore Chardonnet from the anti-poverty group Oxfam.

Countries can be returned to the blacklist if they fail to make the promised changes.

"Today's decision is a confession of failure, said Markus Ferber, vice chair of the European Parliament's economic committee".

"EU governments should tackle tax havens within the European Union with the same urgency they are pressuring other countries to adopt tax reforms that were decided by an exclusive club of rich countries", she added.

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