European Commission: first counter-measures on listed non cooperative tax jurisdictions
The European Commission has proposed guidelines for concrete countermeasures for the EU list of non-cooperative tax jurisdictions.
The guidelines aim to ensure that EU funds do not inadvertently contribute to global tax avoidance. They should guarantee that EU external development and investment funds cannot be channeled or transited through entities in countries on the EU’s common list. This assessment includes a series of checks that should pinpoint a risk of tax avoidance with a business entity. For example, before channeling funding through an entity, it should be established that there are sound business reasons for how a project is structured that do not take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing a tax bill.
The guidance explains the procedure for implementing these requirements, and provides information on how EU partners should assess projects that involve entities in non-cooperative jurisdictions.
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