EU to remove UAE and Switzerland from tax blacklist

The United Arab Emirates and Switzerland are set to be removed from a European Union blacklist of countries deemed to be tax havens, according to a Reuters report citing an official document.

Switzerland has delivered on its commitments, the document said, acknowledging that a tax reform passed last year – and due to be in force from 2020 – was sufficient to meet EU demands.
Switzerland is currently on a greylist that includes countries that have committed to change their tax rules to make them compliant with EU standards.

The UAE, the largest financial center still on the list, is due to be removed after adopting new rules on offshore structures in September, the EU document said. The Gulf state charges no corporate taxes, making it a possible target for firms seeking to avoid paying tax in the countries where they actually operate.

Both countries will be removed from the list on Thursday, October 10.
The Pacific archipelago of the Marshall Islands will also be removed from that list, an EU document said.

Brussels will however continue to blacklist three US territories of American Samoa, Guam, and the US Virgin Islands.

The EU set up a blacklist and a greylist of tax havens in December 2017 after revelations of widespread avoidance schemes used by corporations and wealthy individuals to lower their tax bills.

The lists are regularly reviewed to take account of overhauls or to add new jurisdictions. Blacklisted countries face reputational damage and stricter controls on transactions with the EU.