The EU publishes its blacklist of 17 tax havens

05 December 2017

Today, the EU finance ministers have adopted a blacklist of 17 countries and territories that do not cooperate in the fight against tax evasion and tax avoidance. A second, so-called 'grey list' of 47 countries, including entities that have made commitments but have yet to meet them, was also published. Ministers still have to discuss precisely what kind of sanctions could be applied against countries that do not respect their commitments.

While welcomed in principle, even the high ranks of the Commission were expecting more. To quote Vice President Dombrovskis commenting on the actual list of tax havens: 'We would have liked stronger countermeasures for non-cooperative jurisdictions, and we certainly hope that work will continue to make these measures stronger in 2018 '.

We agree that the step of having this list is an achievement, but we also note, that being such game changer, stronger measures had to be called for. Hope remains in the follow-up work and even higher hopes in the 2018 work of the OECD on 'Taxing the Digital Economy'. That is all very good and relevant but a bit too much like in chess where your next move is never as important as your opponent’s move.

Many concerns and questions are raised by the grey list. How much time are countries supposed to linger in this purgatory? Who sets the limits and the metrics? The list is certainly grey inasmuch as it does not yet provide a clear framework and leaves too much room for interpretation, all the more when it comes to implementing dissuasive national sanctions. Ultimately, too many shades of grey are looming over this first European effort to name and shame countries for their tax fraud practices.

And yet, this remains a very praiseworthy step in the right direction.