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Thirty Territories Make European Commission Tax Haven List

On June 18, in a widespread effort to curtail tax avoidance among European businesses, the European Commission released a preliminary list of non-EU jurisdictions considered to be international tax havens.

In a press conference, EU Economic Affairs Commissioner Pierre Moscovici stated, "We are today publishing the top 30 non-cooperative jurisdictions consisting of those countries or territories that feature on at least 10 member states' blacklists."

According to Moscovici, the idea behind this announcement is to “push non-cooperative non-EU jurisdictions to be more cooperative and adopt international standards."

This comes on the heels of LuxLeaks and a European Commission proposal to reform the region’s taxation system to end advantageous tax deals between European countries and companies such as Pepsi, Google, Starbucks, Ikea, Walmart and Apple.

Countries listed were those named as tax havens by at least ten EU member states. Germany and the UK did not submit individual lists of countries that support tax avoidance by European companies.

The list consists of the following thirty territories: Andorra, Anguilla, Antigua and Barbuda, Bahamas, Barbados, Belize, Bermuda, British Virgin Islands, Brunei, Cayman Islands, Cook Islands, Grenada, Guernsey, Hong Kong, Liberia, Liechtenstein, Maldives, Marshall Islands, Mauritius, Monaco, Montserrat, Nauru, Niue, Panama, St Kitts and Nevis, St Vincent and the Grenadines, Seychelles, Turks and Caicos, US Virgin Islands and Vanuatu.

Listed Jurisdictions React to European Commission Announcement

Several jurisdictions protested their addition to this tax haven list and vowed to have their names removed.

Chief Executive Officer of the States of Guernsey, Paul Whitfield, expressed his concerns over the island’s inclusion, the sole crown dependency listed as an international tax haven.

“It is well known Guernsey meets every international standard on tax transparency and co-operating including the European Commission’s own standards. I think this is just a lack of understanding about our constitution,” he said in a statement to the European Commission.

Guernsey’s Chief Minister, Jonathan Le Tocq, added, “The fact remains that we lead a number of EU Member States on tax transparency and cooperation, and we will be partners of the EU in the automatic exchange of information under the Common Reporting Standard. This means we are well ahead of the full EU 28 – and yet we have been erroneously placed on an arbitrarily defined blacklist. Our priority is to be removed from this list.”

A spokesperson for the government of Liechtenstein shared this sentiment, “calling upon the EU Commission to take the steps necessary to ensure that Liechtenstein is no longer included in any such EU lists of uncooperative countries, and that any existing unwarranted tax discrimination is removed.”

Many Caribbean states also voiced their dismay and began working on having their names extricated from this tax haven blacklist.

According to the Chairman of the Organization of Eastern Caribbean States, Grenada Prime Minister Keith Mitchell, "It is a big surprise, the methodology used in assessing those countries is quite flawed and in fact I believe today it is more an embarrassment to the European Union than the original statement that they made."

Antigua and Barbuda Prime Minister Gaston Browne agreed, saying, “There was no prior warning, and we note, too, that the countries in Europe with whom we have significant trade relations, the United Kingdom as an example, Germany, France, they did not make any such assessment.”

Overall, this list has come under a lot of scrutiny from politicians, policy analysts and activists since it fails to include some of the largest jurisdictions for tax avoidance such as Switzerland and Luxembourg. Additionally, the Netherlands and Ireland, countries implicated in cases similar to those uncovered by LuxLeaks, were not listed.