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The Council of the European Union has decided to remove the Bahamas, Belize, Seychelles, and Turks and Caicos Islands from the list of non-cooperative jurisdictions for tax purposes. This decision follows the EU’s commitment to fostering tax good governance globally.
Updated EU List of Non-Cooperative Jurisdictions
The Council regrets that these jurisdictions are not yet cooperative on tax matters and invites them to improve their legal framework in order to resolve the identified issues
With these removals, the EU’s list now comprises the following 12 jurisdictions:
The EU’s list includes countries that have not engaged in constructive dialogue on tax governance or failed to implement necessary reforms related to tax transparency, fair taxation, and adherence to international standards preventing tax base erosion and profit shifting. Updates to the list occur biannually, usually in February and October, under the guidance of EU finance ministers.
Concerning the Bahamas and Turks and Caicos Islands, deficiencies in enforcing economic substance requirements were noted by the OECD Forum of Harmful Tax Practices (FHTP) since October 2022. Recent assessments reclassified recommendations to both jurisdictions as “soft,” indicating compliance with standards for jurisdictions with minimal corporate income tax.
In October 2023, Belize and Seychelles were added to the non-cooperative list due to negative assessments from the OECD Global Forum on exchange of information. Both jurisdictions will undergo supplementary reviews in the near future following rule changes.
Alongside the non-cooperative list, the Council approved the state of play document, recognizing ongoing cooperation between the EU and its international partners. Albania and Hong Kong fulfilled their commitments by amending harmful tax regimes, leading to their removal from the state of play document.
Aruba and Israel met their pending commitments related to the automatic exchange of financial account information.
Positive ratings from the Global Forum prompted the removal of references to Botswana and Dominica from the relevant section of the document.
The EU list was established in December 2017 as part of the EU’s external taxation strategy. It assesses jurisdictions based on criteria covering tax transparency, fair taxation, and implementation of international standards against tax base erosion and profit shifting.
The Council’s decisions are prepared by the code of conduct group, which collaborates with international bodies to promote global tax good governance. The list undergoes biannual updates, with the next revision scheduled for October 2024.
Efficient defensive measures, both in non-tax and tax domains, are crucial for the effectiveness of the EU list. These measures play a key role in safeguarding the tax revenues of EU member states and combating instances of tax fraud, evasion, and abuse.
More details on the website of the Counsil of the European Union.
