The EU Commission just barked but failed to bite …
It has just published its blacklist of tax havens and there are no surprises. It is disappointing and, worst of all, is of no significance and raises serious questions over the commission’s ability to tackle the issue.
The final list shows 17 countries and is the result of backroom trade-offs and lobbying. The biggest dent to the credibility of the list is that the EU Commission decided from the start not too include EU member states, allowing Ireland, Luxembourg, the Netherlands and Malta off the hook.
The 17 countries on the list will probably laugh off comments made by Pierre Moscovici, commissioner for economic and financial affairs, taxation and customs, on announcing the list: “The adoption of the first ever EU blacklist of tax havens marks a key victory for transparency and fairness.”
No doubt it is an achievement to demand from others what the EU Commission is not prepared to ask of its own members and it is certainly a key victory for transparency to point the fingers at others rather than look at the mirror!
Understandably, the list met a clamour of criticism and, beyond ridiculing the commission for not looking at his own members, observers raised an eyebrow at the omission of the USA, which doesn’t comply with the international standards on information exchange, one of the EU Commission criteria for its blacklisting. Similarly, the commission didn’t screen Russia – a convenient omission?
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UK based charity Oxfam published its own blacklist and said it used the EU Commission criteria. Oxfam’s list is made of 35 non-EU countries and four EU countries. Moscovici commented on this in a press conference before the EU’s list was published. He said that there were no tax havens in the EU, although there were some issues around tax optimisation, and no EU countries could be compared to those on the EU blacklist.
Notwithstanding all the above, and taking a glass half full approach, what does the blacklist mean for the 17 listed? Well the glass is half empty on this one as well. I’m afraid. Here are the EU Commission’s next steps – with comments.
“As a first step, a letter will be sent to all jurisdictions on the EU list, explaining the decision and what they can do to be de-listed.” That will make for a great BBQ starter for whoever receives it.
“The Commission and Member States (in the Code of Conduct Group) will continue to monitor all jurisdictions closely, to ensure that commitments are fulfilled and to determine whether any other countries should be listed in the future.” Scary stuff!
“A first interim progress report should be published by mid-2018. The EU list will be updated at least once a year.” More BBQ starters and excitement ahead.
A commission official told this magazine: “Stronger countermeasures would have been preferable, but we hope that work will continue in 2018 to deliver defensive measures with teeth. On our side, we will work to ensure that the measures already included in key legislation at EU level are applied. Work must continue to ensure that all countries on the commitment list abide by the promises that have been made. We look forward to work on this in the New Year and to the publication of an interim report by the summer 2018.”
The EU blacklist: American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, The Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia, United Arab Emirates
Oxfam’s blacklist: Albania, Anguilla, Antigua and Barbuda, Aruba, Bahamas, Bahrain, Bermuda, Bosnia and Herzegovina, British Virgin Islands, Cook Islands, Cayman Islands, Curaçao, Faroe Islands, Former Yugoslav Republic of Macedonia, Gibraltar, Greenland, Guam, Hong Kong, Jersey, Marshall Islands, Mauritius, Montenegro, Nauru, New Caledonia, Niue, Oman, Palau, Serbia, Singapore, Switzerland, Taiwan, Trinidad and Tobago, United Arab Emirates, US Virgin Islands, Vanuatu, Ireland, Luxembourg, the Netherlands and Malta