Panama commits to CRS, will be removed from EU blacklist
The EU has proposed that Panama be one of several jurisdictions to be removed from its blacklist of tax havens, as the country signs the OECD’s Common Reporting Standard Multilateral Competent Authority Agreement (CRS MCAA).
On Monday January 15, 2018, Panama became the ninety-eighth jurisdiction to sign the CRS MCAA, a move described by the OECD as “reaffirming its commitment to the automatic exchange of financial account information.”
The move towards greater fiscal transparency comes as EU officials propose to remove Panama from its tax haven blacklist, along with seven other jurisdictions.
The proposal was made by the Code of Conduct Group, which comprises tax experts from across the EU Member States, in response to several jurisdictions offering to change their tax rules.
The list of ‘non-cooperative tax jurisdictions’, released in December 2017, assessed jurisdictions on their compliance with international standards of tax transparency and fair taxation, and on their plans to introduce measures against profit-shifting, as recommended by the OECD’s Base Erosion and Profit Shifting (BEPS) initiative.
In response to the inclusion on the list, Panama’s Foreign Ministry commented: “Together with the Panamanian foreign service, the Government will continue to make the necessary efforts to withdraw the country from said list in the short term, and work hand-in-hand with the sector involved to protect the industry.”
Jurisdictions recommended to be removed from the blacklist – Panama, South Korea, the UAE, Barbados, Grenada, Macao, Mongolia and Tunisia – will instead be moved onto a ‘grey list’, where they will be given time to change their tax policies.
The proposal to remove jurisdictions from the blacklist will be discussed at the first Economic and Financial Affairs Council (ECOFIN) meeting of 2018, to take place next Tuesday (January 23, 2018).