Council of the EU revises the EU list of non-cooperative jurisdictions for tax purposes

Deloitte Malta Tax Alert

11 October 2021

On 5 October 2021, the Council of the EU revised the EU list of non-cooperative jurisdictions for tax purposes (‘Annex I’) and the list of jurisdictions included in the state of play document covering jurisdictions which have made commitments to implement tax good governance principles but do not currently comply with all international tax standards (‘Annex II’).

American Samoa, Fiji, Guam, Palau, Panama, Samoa, Trinidad & Tobago, US Virgin Islands and Vanuatu remain on the EU's list of non-cooperative countries.

The main changes approved by the Council of the EU include the following:

  • The EU Council had previously included Anguilla, Dominica and Seychelles in Annex I on the basis that all three jurisdictions failed to fulfil the EU's tax transparency requirements of being classified as at least 'largely compliant' by the OECD Global Forum on Tax Transparency and Exchange of Information (‘Global Forum’) in terms of exchange of information on request. Followed by Global Forum’s decision to grant these jurisdictions a supplementary review, they have now been moved from Annex I to Annex II due to their commitment to implement tax good governance principles.
  • Costa Rica, Hong Kong, Malaysia, North Macedonia, Qatar and Uruguay have also been added to Annex II and have been granted until 31 December 2022 to adapt their legislation and abolish harmful foreign-source income exemption regimes. Jamaica, Jordan, North Macedonia and Qatar have also been provided with a 31 December 2022 deadline to adjust their legislation for abolishing and amending preferential tax regimes in the scope of the OECD Forum on Harmful Tax Practices.
  • In its February 2021 conclusions, the EU Council urged Turkey to commit to automatic information exchange relationships with all remaining Member States by 30 June 2021. However, it was observed that Turkey's progress is still not fully in accordance with its commitments. On this basis, it was decided that Turkey should remain listed in Annex II.
  • Thailand has been granted until 31 December 2021 to ratify the OECD Multilateral Convention on Mutual Administrative Assistance and shall remain listed in Annex II.
  • Australia, Eswatini and Maldives have implemented all the necessary tax reforms and have been removed from Annex I.

The first-ever EU list of non-cooperative jurisdictions for tax purposes was adopted by the EU Council on 5 December 2017 and is updated on a biannual basis with the aim of strengthening tax good governance mechanisms, fair taxation, global tax transparency and the fight against tax fraud, evasion and avoidance. The list is an outcome of extensive screening and dialogue processes with non-EU jurisdictions and a number of jurisdictions have taken concrete measures since 2017 and are expected to maintain such commitments on an ongoing basis.

The Council of the EU’s official press release may be accessed here.

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