04 October 2022

ECOFIN: Taxation: Anguilla, The Bahamas and Turks and Caicos Islands added to EU list of non-cooperative jurisdictions for tax purposes

The Council regrets that these jurisdictions are non-cooperative on tax matters and invites them to engage with the EU’s Code of Conduct Group in order to resolve the identified issues.

The EU continues to promote fair tax competition and address harmful tax practices. The Council today decided to add Anguilla, The Bahamas and Turks and Caicos Islands to the EU list of non-cooperative jurisdictions for tax purposes. With these additions, the EU list now consists of 12 jurisdictions:

• American Samoa
• Anguilla
• The Bahamas
• Fiji
• Guam
• Palau
• Panama
• Samoa
• Trinidad and Tobago
• Turks and Caicos Islands
• US Virgin Islands
• Vanuatu

Turks and Caicos Islands are listed for the first time. The Bahamas were already once listed in 2018, and Anguilla once in 2020.

Fair taxation of businesses benefits all of us. This is why the EU and international partners share a common interest in fighting tax base erosion and profit shifting. I believe all 12 countries on the list will deliver on their commitments and carry out the necessary reforms in the field of taxation as soon as possible, so that they can be deleted from this list when we will next revise it in 6 months time.

Zbyněk Stanjura, Minister of Finance of Czechia

Reasons for adding Anguilla, The Bahamas and Turks and Caicos Islands

This revised EU list of non-cooperative tax jurisdictions (Annex I) includes countries that either have not engaged in a constructive dialogue with the EU on tax governance or have failed to deliver on their commitments to implement the necessary reforms. Those reforms should aim to comply with a set of objective tax good governance criteria, which include tax transparency, fair taxation and implementation of international standards designed to prevent tax base erosion and profit shifting.

The reason for the inclusion of Anguilla, The Bahamas and Turks and Caicos Islands in the list is that there are concerns that these three jurisdictions, which all have a zero or nominal only rate of corporate income tax, are attracting profits without real economic activity (criterion 2.2 of the EU list). In particular, they failed to adequately address a number of recommendations of the OECD Forum on Harmful Tax Practices (FHTP) in connection to the enforcement of economic substance requirements, something to which they committed earlier this year.

The Code of Conduct Group, which prepares the updates of the list, is cooperating closely with international bodies such as the FHTP to promote tax good governance worldwide....

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