EU set to remove Seychelles from tax haven blacklist
© Reuters. FILEPHOTO: An activist protests on a fake tropical island beach, which is a tax haven, outside of a meeting between European Union finance ministers. This was in Brussels, Belgium. REUTERS/Francois Lenoir
By Francesco Guarascio
BRUSSELS (Reuters) – European Union finance ministers are set to remove the Seychelles, Dominica and Anguilla from the bloc’s blacklist of tax havens next week, documents seen by Reuters indicate, while Panama has failed in its request to be delisted.
It was created to prevent widespread tax fraud and tax evasion. The list is updated on a regular basis to either remove or add jurisdictions according to their tax reforms.
EU tax experts recommended delisting the Caribbean island of Dominica and British Caribbean Territory of Anguilla and Seychelles. They have also committed to an additional review of tax systems with The Global Forum on Transparency and Exchange of Information for Tax purposes, which is the most influential international body on tax evasion.
According to one EU document, the EU expects the three jurisdictions to be transferred to its “grey” list of countries who have pledged to tax reforms in “pending the outcome thereof”.
At a meeting held on October 5, the EU’s finance ministers must approve this decision. The EU finance ministers usually agree to tax recommendations. However, this time, one member states expressed concern about one affected jurisdiction, according to one EU document, and without providing further details.
Because of its favorable tax treatment for offshore businesses, the Seychelles is often referred to as a tax paradise.
The document states that EU experts suggested its removal “following resolution of the problem concerning harmful preferential tax systems”.
The EU documents states that Panama requested to be taken off the EU blacklist. But, “unfortunately lacking a commitment by them to repeal or modify their harmful FSIE regim”, the EU says. A foreign-source exemption regime (or FSIE) exempts certain foreign income from taxes.
According to the draft conclusions of next week’s meeting of finance ministers, Panama has not yet resolved this problem.
Blacklisted states are subject to tighter EU transaction controls.
Reuters’s proposals state that no country would be added to the Blacklist. Turkey however, as it opposes automatic exchange of tax information between EU member Cyprus and Turkey, will stay on the “grey” list.
If all changes made are accepted, then the blacklist updated will include nine jurisdictions. They will be American Samoa (Fiji), Guam, Palau and Panama. Samoa and Samoa.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Trading the financial markets is one of most risky investment options. Please make sure you are fully aware about the costs and risks involved.