EU Removes the UAE from Tax Haven Blacklist

 The EU has removed the UAE from Tax Haven Blacklist

The European Union finance ministers have agreed to remove the UAE, Switzerland and Mauritius from the bloc’s lists of countries deemed to be acting as tax havens.As part of the regular review of the lists, the ministers have decided to drop the UAE from the EU blacklist that covers jurisdictions which have failed to cooperate with the EU on tax matters.

The EU has said that the UAE, the largest financial center to be blacklisted, was removed as in September it adopted new rules on offshore structures, giving it a clean-sheet on its tax practices. The Gulf state charges no corporate taxes, making it a possible for it to target firms which are seeking to avoid paying tax in the countries where they actually operate.

The EU does not automatically add countries that charge no tax a sign of being a tax haven – to the blacklist, however, it requested that the UAE introduce rules which would allow only companies with economic activity in the region, to be incorporated in order to reduce risks of tax evasion.

The Marshall Islands have also been removed from the list, which still includes nine extra-EU jurisdictions – mostly Pacific islands with few financial relations with the EU.

Switzerland was removed from the EU grey list, which covers countries that have committed to change their tax rules to make them compliant with EU standards. Switzerland has delivered on its commitments and therefore is no longer listed.

Jurisdictions that remain blacklisted are Belize, Fiji, Oman, Samoa, Trinidad and Tobago, Vanuatu and the three US territories of American Samoa, Guam and the US Virgin Islands.

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Source: Khaleej Times