European Union creates blacklist of 17 'tax haven' countries

European Union creates blacklist of 17 'tax haven' countries

The Paradise Papers leak, which made public some of the intricate ways corporations and individuals evade tax using offshore havens, has given new impetus to the bloc.

An additional 47 jurisdictions were also placed on a newly established "grey list" - a roll call of countries which are also deemed non-compliant, but have committed to changing their tax rules.

The list was agreed by finance ministers from European Union member states in Brussels, but "the lack of well established tax havens from the list has led some MEPs and anti-tax avoidance campaigns to brand it a whitewash", says The Independent.

The news comes as the European Union moves to clamp down on tax avoidance by non-compliant countries and discourage the use of shell structures overseas.

The EU said those blacklisted had refused to cooperate and change their way after nearly one year of consultations.

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After a meeting in Brussels, EU finance ministers announced the blacklist. "The result is a flawed blacklisting process, a politically led list that includes only the economically weak".

The move was hailed as a vital "first step" but the failure of the member states to agree on any sanctions for those on the blacklist provoked the European commissioner for economic and financial affairs, Pierre Moscovici, to concede it was as yet "an insufficient response", reports The Guardian.

In the past few weeks, countries at risk of inclusion have been scrambling to promise reforms.

Hours before the list was announced, officials from Panama, Samoa, Guam and the Marshall Islands said they thought they had done enough to escape being blacklisted. On top of agreeing on the final blacklist, there were also considerations being made for the Caribbean countries that had been damaged during hurricanes earlier this year. That means they promote unfair tax practices, or don't share important financial information with the EU.

Cable argued the British government had a long history of "dragging its heels" when it comes to tax havens, saying he witnessed a lack of action when he was in government.

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