European Commission to draw up list of non-cooperative tax jurisdictions

THE European Commission is to draw up a first common EU list of non-cooperative tax jurisdictions based on a scoreboard.

EU Member States will choose which countries should be screened more fully over the next few months to identify the countries which fail to comply with tax rules.

In January 2016, the Commission launched a three-step process for establishing the common EU list as part of its broader agenda to curb tax evasion and avoidance.

The aim is to publish the definitive list of non-cooperative jurisdictions by the end of 2017. Member States have already given their backing to this approach, which is also strongly supported by the European Parliament.

Pierre Moscovici, commissioner for economic and financial affairs, taxation and customs said: “The EU takes its international tax good governance commitments seriously. It is reasonable for us to expect the same from our international partners. We want to have fair and open discussions with our partners on tax issues that concern us all in the global community. The EU list will be our tool to deal with third countries that refuse to play fair.”

The aim of the Commission’s scoreboard is to help Member States to determine which countries the EU should start a dialogue with regarding tax good governance issues.

The scoreboard presents factual information on every country under three neutral indicators: economic ties to the EU, financial activity and stability factors. The jurisdictions that feature strongly in these three categories are then set against risk indicators, such as their level of transparency or potential use of preferential tax regimes.

The common EU list is intended as a “last resort” option. It will be a tool to deal with third countries that refuse to respect tax good governance principles, when all other attempts to engage with these countries have failed.

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