Delisting Cayman Islands shows the EU tax haven blacklist is not working, says Oxfam

"While we welcome the addition of Barbados, removing the Cayman Islands, one of the world’s most notorious tax havens, from the EU tax haven blacklist is further proof that the process isn’t working.

“Tax havens deprive rich and poor countries of hundreds of billions in lost revenue every year – money that is needed more than ever during the Covid-19 pandemic. Yet instead of holding them to account the EU is allowing the most aggressive countries to be delisted.

”If the blacklist is to retain any credibility the EU must include all countries that operate as tax havens – including countries with zero corporate tax rates and countries where corporate investments outstrip the level of real economic activity they engage in. It is essential that the European Commission and the Council fill these gaps – this should be top of the agenda when it reviews the definition of harmful tax regimes next year.”

Ends

Note to editors:

• Today the EU governments published a revised list of blacklisted countries. Cayman Islands and Oman were completely delisted while Anguilla and Barbados were added to the blacklist.
• In the Communication on tax good governance published in July 2020, the European Commission committed to review the definition of harmful tax regimes (Code of Conduct for Business Taxation) and the listing criteria (based on that definition) during 2021.
• The Cayman Islands has a  zero corporate tax rate and the IMF says it is one of 10 economies that host more than 85 percent of all phantom investments, together with Luxembourg, the Netherlands, Hong Kong SAR, the British Virgin Islands, Bermuda, Singapore, Switzerland, Ireland, and Mauritius. None of those countries is blacklisted.
• The OECD (2020) classifies the Cayman Islands as an investment hub – a jurisdiction where the total inward Foreign Direct Investment are above 150% of GDP. Multinational enterprises report on average a relatively high share of profits (25%) in investment hubs compared to their share of employees (4%) and tangible assets (11%).
• The Cayman Islands is the third  worst tax haven for corporate tax avoidance and the world’s worst tax haven in terms of financial secrecy according to the Tax Justice Network.
• Yesterday Oxfam showed how the EU tax haven blacklist is undermining attempts to stop government bailouts going to corporate tax dodgers: For more information see: https://www.oxfam.org/en/press-releases/weak-eu-tax-haven-blacklist-allows-corporate-tax-dodgers-pocket-millions-euros