On October 23, 2023, the updated list of non-cooperative tax jurisdictions was officially published in the Official Journal of the European Union.

This revision follows a decision by the Economic and Financial Affairs Council (ECOFIN) on October 17, 2023, which adopted conclusions regarding the EU’s list of non-cooperative jurisdictions (Annex I) and assessed the progress of cooperative jurisdictions in implementing tax good governance principles (Annex II, the so-called “grey list”).

The newly updated EU list of non-cooperative jurisdictions now includes the following sixteen territories, with additions highlighted in bold for clarity:

1. American Samoa,
2. Anguilla,
3. Antigua and Barbuda,
4. Bahamas,
5. Belize,
6. Fiji,
7. Guam,
8. Palau,
9. Panama,
10. Russian Federation,
11. Samoa,
12. Seychelles,
13. Trinidad and Tobago,
14. Turks and Caicos Islands,
15. US Virgin Islands, and
16. Vanuatu.

What’s Next?

The EU is expected to update this list again in February 2024, continuing to monitor jurisdictions’ compliance with international tax standards.

Cyprus’ Defensive Measures

In response to this update, Cyprus has implemented withholding tax (WHT) measures as of December 31, 2022. Under these new rules, Cyprus applies WHT on certain outbound payments, including dividends, interest, and royalties, when the recipient is based in a jurisdiction featured on the EU’s non-cooperative list (Annex I).

Impact on EU Mandatory Disclosure Rules (DAC6)

The revised EU list of non-cooperative jurisdictions is also significant for businesses and individuals subject to the EU’s mandatory disclosure rules under DAC6. Specifically, if a recipient of cross-border payments is located in one of the non-cooperative jurisdictions, the transaction may trigger a reporting obligation. Under Hallmark C1b(ii) of DAC6, such payments may trigger a reporting obligation, even if the transaction does not aim to generate a tax benefit (i.e., the main benefit test is not applicable in these cases).

How George Kaimakliotis & Co Ltd Can Help

At George Kaimakliotis & Co Ltd, we offer expert guidance to businesses navigating the complexities of the revised EU list of non-cooperative jurisdictions. Our team provides tailored advice on the implications of withholding tax (WHT) measures, including the correct handling of outbound payments to jurisdictions on the list. We also offer support with compliance under the EU’s DAC6 mandatory disclosure rules, ensuring that businesses meet their reporting obligations and avoid penalties. Whether you’re addressing tax governance or ensuring proper reporting, our team is here to help you navigate the evolving landscape of international tax regulations with confidence.