Opportunity missed to hold EU states accountable for tax haven blacklist
The European Commission and Council of Ministers have scored an own goal in the fight against tax avoidance by omitting EU member states from its own international blacklist on tax havens, say GUE/NGL MEPs.
17 countries and areas are on the blacklist with a further ‘grey list’ for 47 nations which are ‘committed to automatic exchange of information’ including Oman and Hong Kong. No EU country is on the list, however, even though some member states are amongst the worst offenders for allowing multinationals and individuals to exploit existing loopholes for tax avoidance.
The blacklist also excludes low-tax jurisdictions and a number of British Overseas Territories such as Bermuda and the Cayman Islands.
Tax havens on the blacklist face potential sanctions for failing to meet EU standards. However, GUE/NGL’s MEPs on the ‘Panama Papers’ inquiry committee have expressed their disappointment at the list, with group shadow Miguel Urbán MEP saying:
“This blacklist does nothing but illustrate the complicity of the European Union in tax evasion.”
“It has omitted all the tax havens that currently exist in the European Union – countries which would fail the Commission’s own criteria for tax evasion. In that respect, the list drawn up by GESTHA tax experts in Spain that includes 130 countries seems much more reliable.”
“The European Union cannot lecture third countries to abide by its rules if its own house isn’t in order. There must be sanctions for member states that do not comply with EU’s minimum standards of fair taxation, collaboration and transparency,” argued Urbán.
Whilst Ireland’s Matt Carthy MEP welcomes the introduction of a tax haven blacklist, he has described its content as a “whitewash”:
“In addition to the automatic exclusion of EU member states, political lobbying by countries like Britain resulted in its dependencies not being included.”
“The process by which the jurisdictions were selected was highly politicised and also highly secretive. The Commission and the Council need to release the documents and minutes of meetings where the selection process took place and the negotiations that saw some jurisdictions removed from the list.”
“However, let’s not fool ourselves that the Commission’s blacklist will be an effective tool at ending the offshore scam – it won’t be. EU members must commit to global and public country-by-country reporting for multinationals and to fully public beneficial ownership registers as immediate and more effective tools for fighting tax fraud and financial secrecy,” added the Irish MEP.