UAE Says BEPS Inaction To Blame For EU Blacklisting
- Author: Lawrence Cooper Dec 08, 2017,
Dec 08, 2017, 1:33
In a December 7 statement, the Government said: "We remain fully committed to maintaining the highest global standards of financial oversight and tax regulation, and will continue to work with our worldwide partners to deliver this".
After a meeting in Brussels on Tuesday EU finance ministers said American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia and the United Arab Emirates are not doing enough to crack down on offshore avoidance schemes.
"Blacklisted jurisdictions must face consequences in the form of dissuasive sanctions, while those that have made commitments must follow up on them quickly and credibly", he said.
The list was made on the basis of three main components: tax transparency, fair tax competition and implementation of Base Erosion and Profit Shifting (BEPS), which is a way of battling tax avoidance created by the OECD.
The UAE said in a statement on Thursday that it's "committed to a reform process which will be finalized by October 2018" and that it's "absolutely confident this will ensure the UAE is swiftly removed from the list".
The bloc did not assess its own member states.
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The EU will continue to monitor and, if needed, update the blacklist of tax havens, it said. "We must not accept unfair tax competition and opacity".
Tove Maria Ryding, from Eurodad, another NGO, said that the list "looks like an attempt to divert attention away from the fact that European Union governments have failed to clean up their own house".
This second list includes Switzerland, Turkey and Hong Kong.
It has also been reported that following the release of the "Panama Papers" and "Paradise Papers", by Germany's Suddeutsche Zeitung and the International Consortium of Investigative Journalists (ICIJ), in conjunction with media houses around the world, the European Union has been looking into discouraging the use of tax havens, even though they are legal. By naming and shaming the non-compliant tax jurisdictions, the European Union aimed to increase good tax governance worldwide, combat the use of tax schemes overseas and prevent large-scale tax abuse.
The European Commission - the EU's executive arm - says that the threat of being on the list can itself incentivize countries to bring their tax systems in line with EU standards, for fear of being named and shamed.