Gibraltar to lose tax haven status
UK bows to EU demands and scraps Gibraltar's tax haven status.
The UK has bowed to EU demands that it scrap Gibraltar’s status as a company tax haven after the EU threatened court action if the scheme was not ended. Link: Hellish outlook for tax havens
The scheme – the Gibraltar Exempt Company Tax Regime – will accept no new participants after July 2006 and will be removed completely in 2010.
The Times reports that the European Commission regards the scheme as unfair and an illegal form of State aid.
In a statement EU Competition Commissioner Neelie Kroes said the abolition of the Gibraltar tax scheme was ‘an important step towards eliminating harmful tax practices that violate EC treaty State aid rule’.