Bahrain Mirror: The European Union has published its first blacklist of tax havens, naming 17 territories including three Arab countries: Bahrain, United Arab Emirates and Tunisia.

BBC reported that a "watchlist" of 47 countries promising to change their tax rules to meet EU standards has also been issued.

The "grey list" includes several with UK links, including Hong Kong, Jersey, Bermuda and the Cayman Islands, as well as Switzerland and Turkey.

Both lists have been criticised as omitting the most notorious tax havens.

The lists follow the leaking of the Panama Papers and the Paradise Papers, revealing how companies and individuals hid their wealth from tax authorities around the world in offshore accounts.

EU tax commissioner Pierre Moscovici said the blacklist represented "substantial progress", adding: "Its very existence is an important step forward. But because it is the first EU list, it remains an insufficient response to the scale of tax evasion worldwide."

To determine whether a country is a "non-cooperative jurisdiction" the EU index measures the transparency of its tax regime, tax rates and whether the tax system encourages multinationals to unfairly shift profits to low tax regimes to avoid higher duties in other states. In particular these include tax systems that offer incentives such as 0% corporate tax to foreign companies.

EU members have been left to decide what action to take against the offenders. Ministers ruled out imposing a withholding tax on transactions to tax havens as well as other financial sanctions.

Panama is one of the 17 countries listed by the EU but its president, Juan Carlos Varela, said the country was "not in any way a tax haven".

The EU is encouraging member states to take what it calls "defensive actions" against those countries that do not reform their tax systems.

Arabic Version