NEWS FLASH: EU adds three states to tax blacklist, BVI on grey list
13 Mar 2018

The European Council has added three states to the Annex 1 list of non-cooperative jurisdictions, dubbed the EU tax blacklist, saying they have failed to make commitments at ‘a high political level’ to address issues raised.

The Bahamas, Saint Kitts and Nevis and the US Virgin Islands were added on Tuesday, according to a Council statement.

It has also decided to remove Bahrain, the Marshall Islands and Saint Lucia from the blacklist to its Annex 2 list, commonly referred to as the EU tax grey list.

Anguilla, Antigua and Barbuda, the British Virgin Islands (BVI) and Dominica were also placed on the grey list.

The changes were made following the Council’s review of offshore jurisdictions hit by extreme weather.

The Council said when it first published its list (in December last year), it decided to freeze its screening of the tax systems of Caribbean jurisdictions that were involved in the hurricanes of September 2017.

The process was, however, restarted in January 2018, when it sent out letters requesting commitments to address EU concerns.

The three added onto Annex 1 on Tuesday had failed to make commitments, the Council said.

Those added onto the grey list – Anguilla, Antigua and Barbuda, the British Virgin Islands (BVI) and Dominica – had however, made commitments to address the deficiencies identified by the EU.

“Those commitments were assessed by EU experts, and their implementation will be carefully monitored,” the Council said.

The Council added: “The process continues with regard to an eighth Caribbean jurisdiction, the Turks and Caicos Islands, from which a commitment at a high political level is being sought by 31 March 2018 to address EU concerns.”

On Tuesday, Vladislav Goranov, minister for finance of Bulgaria, which currently holds the Council presidency, said: “I am glad to see more jurisdictions that we listed in December committing themselves to reforming their tax policies in a manner that will remedy our concerns.”

On 9 March the Bahamas published a statement on its website expressing its ‘disappointment’ that the EU Code of Conduct Group (COCG) will be recommending that it be included on the list of non-cooperative jurisdictions.

It said throughout the process it has ‘consistently been engaged with the OECD and the COCG on the EU listing criteria,’ and added that it would continue to ‘demonstrate [its] commitment to international regulatory standards.’

KYC360 made efforts to reach Saint Kitts and Nevis and the US Virgin Islands for a comment, but they did not respond by press time.

Read more:

EU tax blacklist – what on earth happened?

EU method of drafting tax blacklists to be investigated

EU Sixth Anti-Money Laundering Directive (6AMLD) – Expert analysis of new EU measures

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