Britain puts brakes on EU tax haven blacklist push
EUROPEAN Union finance ministers painfully agreed on the criteria to draw up a European blacklist of tax havens, but Britain watered down the proposal, eager to protect low tax dependencies such as Bermuda and Guernsey.
Europeans have struggled to agree on the basis of an EU-wide tax haven blacklist, even after revelations in the Panama Papers and LuxLeaks scandals shocked the general public on the strategies used by the rich people and big companies to reduce tax bills.
The European Commission, the EU’s executive arm, has taken the lead on cracking down on tax havens and wants to draw up a list of problem jurisdictions.
Britain, as well as Malta and the Baltic states, however blocked a push to include zero or nearzero corporate tax rates as one of the criteria to land on the EU’s blacklist.
The ministers agreed to delay that decision for now – presumably at least until after Britain leaves the EU after its Brexit divorce, expected in 2019. But it ordered a task force to explore the idea further.
The 28 ministers agreed other criteria however including a demand that third countries automatically exchange tax information and agree to an already existing set of G20 standards to fight tax evasion.
EU Commission vice president Valdis Dombrovskis said the EU would notify a broad list of countries by the end of January, from which the far more narrower blacklist would be drawn before 2018.
The EU blacklist in one of many ideas given in reaction to the leak of thousands of documents last Spring on anonymously-owned shell companies from Mossack Fonseca, a Panamanian law firm that specialised in setting up such firms. –