EU: EU Keeps Panama And Ten Other Countries On Its List Of Tax Havens

The European Union countries approved on Tuesday to keep Panama, Russia and nine other jurisdictions on their blacklist of tax havens after finding that they continue not to cooperate in this matter or have not made the reforms to which they had committed. The list, specifically, is made up of American Samoa, Anguilla, Fiji, Guam, Palau, Panama, Russia, Samoa, Trinidad and Tobago, the American Virgin Islands and Vanuatu, according to a statement from the Council of the EU, the institution in which the member states are represented.

“Although there have been some positive developments in this round of updating, the Council regrets that these jurisdictions do not yet fully cooperate on tax matters and invites them to improve their legal framework to resolve the problems identified,” said the institution. The list, which has been in place since 2017 and is updated every six months, includes jurisdictions that fail to meet EU standards on tax transparency, tax justice or the implementation of international standards to prevent base erosion or profit shifting, and which also fail to take steps to address these problems.

Being included on the list does not entail financial penalties, beyond the prohibition of European funds passing through entities based in these jurisdictions and administrative measures, such as more frequent audits, although States can decide at national level to impose other types of penalties. On the other hand, the EU’s economic and financial ministers have also approved the update of the so-called“grey list”, which includes jurisdictions that do not fully comply with EU standards to be considered cooperatives, but which have committed to making changes to comply. On this occasion, the EU has removed Costa Rica and Curaçao from the list since they have fulfilled their commitment to modify a harmful tax regime, the Council explained.

At the same time, Brunei Darussalam has been included after having committed to abolish its tax exemption regime on foreign-sourced income by the end of 2026. Following the changes, Antigua and Barbuda, which had entered the blacklist in the last update, as well as Turkey, Vietnam, the British Virgin Islands, Belize, Seychelles and Eswatini, appear on this list. “We seem to be stuck in a cycle of no progress. Meanwhile, big companies and the ultra-rich continue to exploit tax havens to avoid paying their fair share,” said the NGO Oxfam in a statement, which called on the EU to blacklist any country that allows companies to pay little or no tax or hide their real owners.