THE European Union (EU) on Tuesday added Anguilla, The Bahamas and the Turks and Caicos Islands to its blacklist of tax havens.

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 and Vanuatu.

Two countries, Bermuda and Tunisia ,were completely delisted.

In a release, the European Council said it 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.

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

Chiara Putaturo, Oxfam EU’s tax expert, argues the move is “a total whitewash”.

Putaturo said, “This is not a blacklist, it is a whitewash. Two years have passed since the EU agreed to strengthen the list and give it some teeth, but nothing has changed. The criteria remain woefully weak. While this list captured three zero-tax rate countries, it was not due to their tax rate and they can easily be delisted again. The EU should automatically blacklist zero- and low-tax rate countries and hold European countries up to the same level of scrutiny as non-European countries. The current list makes the EU a hypocrite as major tax havens in Europe like Malta and Luxembourg escape the list while countries outside Europe like Eswatini and Botswana risk being blacklisted.”

The EU noted that the reason for the inclusion of Anguilla, The Bahamas, and Turks and Caicos Islands in the list is that there are concerns 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 current blacklist includes only one of the world’s 20 worst corporate tax havens identified by Tax Justice Network (TJN) in 2021, and one of the world’s 15 worst corporate tax havens identified by the 2016 Oxfam analysis.

Among the 12 countries in the world with a zero per cent tax rate, three are blacklisted and two are greylisted. Bermuda, which was delisted today, is a zero-tax jurisdiction. It is the third most-harmful tax haven in the TJN Tax Havens Index and the first one in the Oxfam 2016 tax havens ranking.

Putaturo contends, “Stronger criteria could stop the industrial levels of tax dodging by the world’s richest and corporates. Governments and ordinary people are facing the cost-of-living crisis. Ending tax havens could provide the much-needed hundreds of billions in revenue as the world’s super-rich would have to pay their fair share.”

The EU list of non-cooperative jurisdictions for tax purposes was established in December 2017. It is part of the EU’s external strategy on taxation and aims to contribute to ongoing efforts to promote tax good governance worldwide.

Since 2020 the council updates the list twice a year. The next revision of the list is scheduled for February 2023.