In February the Council of the European Union updated its list of non-cooperative jurisdictions for taxation purposes, adding the British Virgin Islands, Costa Rica, Marshall Islands, and Russia to the so-called “Blacklist.” The reasons for their inclusion are as follows: the British Virgin Islands failed to comply sufficiently with the OECD standard on the exchange of information on request, Costa Rica did not fulfil its commitment to abolish or amend the harmful aspects of its foreign source income exemption regime, the Marshall Islands have a zero or only nominal rate of corporate income tax and lack enforcement of economic substance requirements, and Russia failed to address the harmful aspects of a special regime for international holding companies and followed aggressive actions against Ukraine. Additionally, some jurisdictions, such as Barbados, Jamaica, North Macedonia, and Uruguay, were removed from Annex II for fulfilling their commitments, while others were granted extensions to complete reforms. The Blacklist is reviewed twice a year, with the next review scheduled for October 2023.
© INNOVATOR 03.03.2023.
