The EU Commission has updated its list of non-cooperative tax jurisdictions, adding the Republic of Palau to the list.
The Cayman Islands, Panama, and Seychelles have also been added as they failed to comply with the required standards within the commission’s deadline.
The four countries join Guam and seven other jurisdictions — American Samoa, Fiji, Samoa, Oman, Trinidad and Tobago, Vanuatu, and U.S. Virgin Islands — that are already on the list and remain non-compliant, according to the EU.
The EU Commission conducts its assessment based on three main criteria: tax transparency, fair taxation, and real economic activity.
According to the EU, those that fall short on any of these criteria are asked for a commitment to address the deficiencies within a set deadline.
Over half of the countries covered by the 2019 listing have been completely delisted, as they are now in line with all of the tax good governance standards, according to the EU.
Following the update, Paolo Gentiloni, Commissioner for the Economy, said: “The EU list of non-cooperative tax jurisdictions is helping to deliver real improvements in global tax transparency.”
“To date, we have examined 95 countries’ tax systems and the majority of these now comply with our good governance standards. This process has led to the elimination of over 120 harmful tax regimes worldwide and dozens of countries have started to apply tax transparency standards. Our citizens expect the wealthiest individuals and corporations to pay their fair share in tax and any jurisdiction that enables them to avoid doing that must face the consequences. Today’s decisions show that the EU is serious about making that happen,” Gentiloni said.
The EU says it will continue to dialogue with the countries and territories on the list in advance of the next update.
The next update will be released in October this year.