On 20 February, the European Council published the updated EU list of non-cooperative jurisdictions for tax purposes. The list will become official shortly with its publication in the Official Journal.<\/p>\n\n\n\n
The list, first established in 2016 at the proposal of the European Commission as part of the anti-tax avoidance package, <\/strong>aims to identify countries that do not meet their commitments to comply with good tax governance criteria within a certain timeframe or have refused to do so.<\/p>\n\n\n\n As early as November of that year, the Council mandated the Code of Conduct Group, which is <\/strong>responsible for business taxation, to select and rank non-EU countries on the basis of their economic ties with the EU; their institutional stability; and the importance of their financial sector.<\/p>\n\n\n\n The first official list was published on 5 December 2017 and included two categories: the first, with 17 countries, indicated those that had failed to take adequate measures in response to EU tax concerns (commonly known as the blacklist); the second, known as the greylist or Annex II, concerned countries that, while not fully meeting the criteria, had committed to do so within a certain timeframe.<\/p>\n\n\n\n Since then, the list has been regularly updated through dynamic monitoring of the measures implemented by the jurisdictions, based on a set of procedural guidelines issued in February 2018.<\/p>\n\n\n\n Starting in 2020, the updated list will be published twice a year to allow EU Member States sufficient time to amend national legislation where necessary. This means that this will be followed by the review scheduled for October 2024.<\/p>\n\n\n\n To be considered cooperative for tax purposes, third country jurisdictions are selected based on a set of criteria established in 2016 by the Council, which evolve over time in line with international standards of good tax governance. These criteria cover tax transparency, tax fairness and anti-BEPS measures.<\/p>\n\n\n\n The tax transparency <\/strong>criteria aim to increase the exchange of tax information between EU states and their citizens living abroad in order to reduce tax avoidance. At the beginning, the exchange of information between a jurisdiction and all member states took place automatically through adherence to the OECD’s Common Reporting Standard (CRS) or through bilateral agreements. In 2022, the global forum began publishing comparative reviews of different jurisdictions’ implementation of automatic information exchange. As a result, the Code of Conduct Group decided to incorporate these reviews into its ranking method, urging jurisdictions to commit to correcting any negative assessments, failing which they would be listed. Also for the sake of greater transparency, jurisdictions should be able to exchange tax information upon request and have a network of agreements for their exchange, also for the purpose of mutual administrative assistance in tax matters.<\/p>\n\n\n\n Tax fairness <\/strong>rules concern all practices that attract financial flows without reflecting actual economic activity. In particular, they concern the absence of both harmful preferential tax measures and the facilitation of offshore structures. Potentially harmful preferential regimes are identified on the basis of criteria for unfair tax competition affecting the location of businesses. Furthermore, jurisdictions must not apply low or zero taxes for the purpose of attracting profits without any actual economic activity for avoidance purposes.<\/p>\n\n\n\n The measures against base erosion and profit shifting (BEPS<\/strong>) should ensure that jurisdictions comply with and commit to implementing the OECD minimum standards on harmful tax measures, treaty shopping, country-by-country reporting and dispute resolution.<\/p>\n\n\n\n For a better implementation of the EU list, it is important that member states implement defensive measures to protect tax revenues and combat tax fraud, evasion and abuse on the basis of their national systems.<\/p>\n\n\n\n Member countries subsequently agreed to apply at least one of the following administrative measures<\/strong>:<\/p>\n\n\n\n Furthermore, as of 1 January 2021, they agreed to use the list in the application of at least one of these four measures:<\/p>\n\n\n\n In addition to these fiscal measures, member states should take defensive measures in the extra-fiscal sphere for issues concerning foreign policy, development cooperation and economic relations with third countries. Another factor to consider is that, according to certain funding rules, blacklisted countries are not eligible for certain European funds such as the European Fund for Sustainable Development (EFSD) and the European Fund for Strategic Investments (EIFS).<\/p>\n\n\n\n The current updates published by the Council are actually very positive in nature, as they only provide for removals and shifts to lower categories for the states involved, as follows:<\/p>\n\n\n\n The resulting composition of the list is:<\/p>\n\n\n\n BLACKLIST <\/strong>(12 items)<\/p>\n\n\n\n GREYLIST <\/strong>(10 items)<\/p>\n\n\n\n Non-EU states that are not mentioned in the lists are considered to be countries that cooperate with the EU and have no outstanding commitments, and are therefore whitelisted.<\/p>\n\n\n\n Sources: https:\/\/www.consilium.europa.eu\/<\/a> <\/p>\n\n\n\n AI-generated image<\/p>\n\n\n\nListing Criteria<\/strong><\/h2>\n\n\n\n
Fiscal and extra-fiscal defensive measures<\/strong><\/h2>\n\n\n\n
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Changes and current lists<\/strong><\/h2>\n\n\n\n
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