Following the release of the ‘Panama Papers’ (and now the ‘Paradise Papers’), and the resulting public concern as to the scale of tax avoidance and evasion and the ability of offshore jurisdictions to facilitate these activities, the European Commission started work on producing a common EU list of non-cooperative tax jurisdictions using a common set of objective criteria. This list is expected to be published by the end of this year once it is agreed with the Member States, together with a list of measures and sanctions to apply to the specified non-cooperative tax jurisdictions.
It is currently unclear which jurisdictions will appear on the list and what sanctions will apply to a jurisdiction specified on the list. It has also been proposed that EU legislation would be introduced to harmonise obligations for tax authorities in the Member States to annually disclose data containing the total value and destination of the money transfers of each Member State to each jurisdiction in that list.
The EU list is expected to be more extensive than the OECD’s list of non-cooperative jurisdictions on tax which only has one country: Trinidad and Tobago. As a result, it is possible that the EU list may include certain common offshore fund jurisdictions.