Once again, the EU lets tax havens off the hook

Published: 18th February 2020

In today’s review of the European Union’s tax haven list, EU finance ministers have added Panama, the Cayman Islands and the Seychelles to the list. At the same time, they have let the Bahamas, Bermuda and the British Virgin Islands off the hook.

Chiara Putaturo, Oxfam’s EU Policy Advisor on Tax and Inequalities, said:

“We are glad to see that EU governments added Panama, the Cayman Islands and the Seychelles to the tax haven blacklist, as they should be. However, the list still proves inadequate: EU governments have let the Bahamas, Bermuda and the British Virgin Islands – some of the world’s most harmful tax havens – off the hook. These countries run an unfair tax competition and lead the race to the bottom in corporate tax by offering zero-tax rates, or very low tax rates, so that companies avoid paying their fair share.

“What’s more, the credibility of the blacklisting process continues to be undermined by the EU’s own tax havens. They are exempted from the screening despite failing the EU criteria and offering sweetheart tax deals to companies.

“The EU needs to strengthen its blacklisting criteria, put its own house in order and push for an ambitious and effective minimum tax rate at global level. Tax havens deprive countries in Europe and across the developing world of the tax revenues they need to invest in public services such as schools and hospitals. Ordinary people all over the world, and women in particular, are the ones paying the price.”

Notes to editors

  • Today, European finance ministers have published an official review of the EU list of non-cooperative jurisdictions, screening 95 countries. 12 countries were listed on the blacklist and 13 countries on the ‘grey list’.
  • The Bahamas, Bermuda and the British Virgin Islands have been identified by Oxfam as important tax havens and are also among the top-10 countries in Tax Justice Network’s Corporate Tax Haven Index. These countries were completed removed by the EU from all lists.
  • One year ago, Oxfam published the Report “Off the Hook”, documenting how the EU blacklisting process is not fit for purpose and helps to whitewash some of the world’s worst tax havens. Yesterday, Oxfam published an update of the analysis.
  • Oxfam’s analysis finds that five EU member states – Cyprus, Ireland, Luxembourg, Malta and the Netherlands – would be listed as tax havens if the EU criteria were applied to them.
  • A minimum effective tax rate is currently being discussed by the OECD Inclusive Framework as part of negotiations for global tax reforms. A minimum effective tax rate should be set at an ambitious level and applied at a country-by-country basis without exception. Such a minimum tax rate would put a stop to the damaging tax competition between countries and remove the incentive for profit shifting – effectively putting tax havens out of business. For more details, read Oxfam’s opinion on the OECD’s proposal and Oxfam’s submission to the OECD public consultation.

Contact information

Florian Oel | Brussels | florian.oel@oxfam.org | office +32 2 234 11 15 | mobile +32 473 56 22 60

For updates, please follow @Oxfam and @OxfamEU