Financial Privacy May Still be Alive in EU Black List Countries
Every year a new EU list of non-cooperative jurisdictions is published. The EU publishes the list to shame non-cooperative jurisdictions into compliance with EU demands for ‘transparency’. From my point of you any country on the EU list of non-cooperative jurisdictions is worth exploring further. Any country on the EU’s list just might still respect financial privacy.
The EU talks about concepts like ‘Fair Taxation’ and ‘Global Tax Transparency’ in its document on non-cooperative jurisdictions. The concept of ‘fair taxation’ is as absurd as the concept of ‘fair theft’. Something that’s not voluntary can never be described as fair.
Here is the EU List of Non-Cooperative Jurisdictions
The EU says that American Samoa refuses to automatically exchange financial information. That is enough to get it on the EU’s black list.
According to the EU Anguilla ‘facilitates offshore structures and arrangements aimed at attracting profits without real economic substance’
Like Anguilla, The Bahamas facilitates offshore structures and arrangements that allow people and corporations to reduce their taxes. Companies incorporated in The Bahamas are tax free worldwide.
Fiji got itself on the EU list of non-cooperative jurisdictions for not being part of the Global Forum on the automatic exchange of information for tax purposes. The Common Reporting Standard requires all countries to automatically exchange information on bank balances.
Guam also does not participate in the automatic exchange of private financial information. This earned the jurisdiction a place on the EU’s blacklist.
Palau has not signed the OECD’s Multilateral Convention on Administrative Assistance (a snooper’s charter). It also does not apply any automatic exchange of financial information.
Panama displeased the EU by maintaining its territorial tax system. The EU hates the fact that its citizens can leave the EU and move to jurisdictions like Panama that only tax income earned in Panama. The EU wants every country to tax worldwide income.
According to the EU, Samoa has a ‘harmful preferential tax regime’. This earned Samoa a place on the EU list of non-cooperative jurisdictions.
Trinidad and Tobago
Trinidad and Tobago does not automatically share financial information with other countries. It also operates free zones which the EU describes as ‘harmful preferential tax regimes’.
Turks and Caicos Islands
The Turks and Caicos facilitates offshore structures and arrangements that help businesses lower their taxes. The EU seems unhappy about this.
US Virgin Islands
The US Virgin Islands are not part of CRS and therefore don’t automatically share financial information. This earned the territory a place on the EU’s list of non-cooperative countries.
The EU has not been happy with Vanuatu for some time. They recently cancelled visa free travel to the Schengen zone with Vanuatu passports. They’re also concerned that Vanuatu are facilitating the setup of offshore structures that help avoid tax.
The EU list of non-cooperative jurisdictions is interesting. It shows the small number of countries who have been able to withstand international pressure to share financial information and clamp down on offshore structures. It’s worth noting though that the EU is a political organization. Many other countries offer offshore structures and don’t participate in automatic information exchange. Those that have political clout with the EU don’t appear on the list. It’s a good thing that they refuse to bow to pressure from the EU to conform to their rules.
Organisations like the EU want to abolish financial privacy and make sure that everyone is subject to high taxes. No doubt more of these countries will cave in to international demands in the future. Others may see a commercial advantage in offering financial privacy to international clients. Let’s hope so.