The finance ministers of the European Union member states have called for the creation of a blacklist of tax havens to crack down on tax dodging, the ministers said at a meeting in Brussels on November 7.
The issue of tax dodging by wealthy and powerful people has been highlighted yet again by a leak of documents known as the Paradise Papers. The documents uncovered dubious tax dealings by a number of companies and individuals, drawing an angry reaction from the EU.
The EU now wants to compile a list of tax havens that offer reduced or zero taxation rates luring companies or wealthy individuals to avoid taxation in their home countries.
“There was strong support for the idea of moving forward quickly,” Estonian Finance Minister Toomas Toniste said in Brussels, Reuters reported. Estonia holds the EU’s rotating presidency until the end of the year.
However, not all countries are keen on the idea of a crackdown or on tackling the issue of tax dodging with equal force, it seems, as some of them make good money from the business. The main point of contention in the discussion is whether the eventually blacklisted countries should be sanctioned or not.
While some of the locations that could go on the blacklist include offshore jurisdictions such as Bermuda or Jersey – both British territories – there are also regular member states like Malta or Luxembourg that have been under fire for being tax havens. Latvia is another country with a history of offering advice on dodging tax as is Cyprus.
The EU is currently looking at about 50 locations worldwide, suspecting them of offering tax haven conditions.
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