NASSAU, Bahamas — The Bahamas could be on the brink of once again being blacklisted by the European Union (EU), according to an Associated Press (AP) story published on Thursday.
The Bahamas was previously identified by the EU as facilitating tax evasion, which underscored the bloc’s move to blacklist the jurisdiction in June 2015.
The AP reported that the EU’s executive commission put Afghanistan, Bosnia and Herzegovina, Guyana, Iraq, Laos, Syria, Uganda, Vanuatu and Yemen on a proposed blacklist of countries at risk of money laundering and terror financing. However, European Union lawmakers were not satisfied with the proposed blacklist, calling for an expansion to include countries that facilitate tax crimes. The lawmakers want The Bahamas on the list.
“The Bahamas was one place mentioned,” AP reported.
This despite a raft of tax information exchange agreements (TIEAs), the signing of an inter-governmental agreement (IGA) with the US on implementation of the Foreign Account Tax Compliance Act (FATCA) and the decision by The Bahamas to adopt the OECD standards on automatic exchange of information (AEOI).
In September of last year, the Organisation for Economic Cooperation and Development (OECD) attacked The Bahamas by way of an unattributed article in The Economist, which blasted The Bahamas as a “holdout” and sought to paint the jurisdiction as a “tax haven of long standing”. Government officials who spoke to the matter said the attack was predicated on an OECD preference for the multilateral approach to AEOI.
Nearly 400 EU lawmakers opted for the blacklist to be revised.
“In a resolution passed yesterday by 393 votes to 67 votes, with 210 abstentions, lawmakers said the list is too limited and should include territories that make tax crimes easier,” said the AP.
“Dutch lawmaker Judith Sargentini, who drew up the resolution, said ‘We now hope that the European Commission will be more ambitious in revisions, so as to create a blacklist which is fit-for-purpose’.”
German politician and lawmaker Sven Giegold said, “In light of recent leaks revealing money laundering and tax crimes, it is ridiculous that Panama and other famous havens for dirty money are still not on the commission’s blacklist.”
On the other hand, Member of the European Parliament Krisjanis Karins counter-argued that “A country should be placed on the blacklist only when there is clear evidence of a systematic threat of money laundering and terrorist financing.”
According to the AP, EU states agreed to establish a blacklist of tax havens by the end of this year, although critics say the list may turn out to include none of the top countries helping taxpayers avoid their bills.
Minister of Financial Services Hope Strachan was expected to say more on the matter on Friday.