EU removes UAE, Switzerland, Mauritius from tax haven lists

Thu 10 Oct 2019 at 12:11 International
NNA - European Union finance ministers agreed to remove the United Arab Emirates, Switzerland and Mauritius from the bloc’s lists of countries deemed to be acting as tax havens, a move that activists called a "whitewash".


The 28-nation EU set up a blacklist and a gray list of tax havens in December 2017 after revelations of widespread avoidance schemes used by corporations and wealthy individuals to lower their tax bills.


Blacklisted states face reputational damage and stricter controls on transactions with the EU.


As part of the regular review of the lists, the ministers decided to drop the UAE from the EU blacklist that covers jurisdictions that have failed to cooperate with the EU on tax matters.


The Marshall Islands has also been removed from that list, which still includes nine extra-EU jurisdictions - mostly Pacific islands with few financial relations with the EU.


The UAE, the largest financial center which was blacklisted, was removed because in September it adopted new rules on offshore structures, the EU said, giving it a clean-sheet on its tax practices.


The Gulf state charges no corporate taxes, making it a possible target for firms seeking to avoid paying tax in the countries where they actually operate.


The EU does not automatically add countries that charge no tax - a sign of being a tax haven - to its blacklist, but it requested the UAE introduce rules that would allow only companies with a real economic activity there to be incorporated in order to reduce risks of tax dodging.--REUTERS


===============R.H.

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