By Durrant Pate/Contributor

The European Union (EU) Council removed Antigua and Barbuda from its list of non-cooperative jurisdictions for tax purposes. 

In addition to Antigua and Barbuda, the council in its latest update has removed 11 jurisdictions from its list of non-cooperative jurisdictions for tax purposes. 

They are Anguilla, American Samoa, Fiji, Guam, Palau, Panama, Russia, Samoa, Trinidad and Tobago, US Virgin Islands, and Vanuatu.

The council regrets that there are jurisdictions not yet cooperative on tax matters and invites them to improve their legal framework in order to resolve the identified issues.

Reasons for removing Antigua and Barbuda 

Antigua and Barbuda was included in the EU list of non-cooperative jurisdictions for tax purposes in October 2023, after a negative assessment from the Organization for Economic Cooperation and Development (OECD) Global Forum on the exchange of information upon request. However, following changes to the applicable rules in Antigua and Barbuda, the Global Forum has granted it a supplementary review, which will be undertaken soon. 

Pending the outcome of this review, Antigua and Barbuda has been included in the relevant section of Annex II. In addition, two jurisdictions that have been listed for an extended period of time, namely Fiji and Palau, have made promising steps towards compliance with the listing criteria, and this has been reflected in their entries in the list.

State of play document (Annex II)

In addition to the list of non-cooperative tax jurisdictions, the EU Council approved the usual state of play document (Annex II), which reflects the ongoing EU cooperation with its international partners and the commitments of these countries to reform their legislation to adhere to agreed good tax governance standards.

Its purpose is to recognise ongoing constructive work in the field of taxation and to encourage the positive approach taken by cooperative jurisdictions to implement good tax governance principles. Two jurisdictions, Armenia and Malaysia, fulfilled their commitments by amending a harmful tax regime. 

As such, they will be removed from the state of play document. In the light of recent reassurances, Vietnam has been given more time to comply with its commitment on country-by-country reporting and will be reassessed in the next update, planned for February 2025.

Background

The EU list of non-cooperative jurisdictions for tax purposes was established in December 2017. It is part of the EU’s external strategy on taxation and aims to contribute to ongoing efforts to promote tax good governance worldwide.

Jurisdictions are assessed based on a set of criteria laid down by the council. These criteria cover tax transparency, fair taxation, and implementation of international standards designed to prevent tax base erosion and profit shifting. 

The chair of the code of conduct group conducts political and procedural dialogues with relevant international organisations and jurisdictions, where necessary. Work on the list is a dynamic process. 

Since 2020, the council has updated the list twice a year. The list is set out in Annex I of the Council conclusions on the EU list of non-cooperative jurisdictions for tax purposes. The conclusions also include a state-of-play document (Annex II) identifying cooperative jurisdictions that have made additional improvements to their tax policies or related cooperation. 

The council’s decisions are prepared by a code of conduct group responsible for monitoring tax measures in EU member states. The code of conduct group is cooperating closely with international bodies such as the OECD Forum on Harmful Tax Practices (FHTP) to promote tax good governance worldwide.