Report: EU To Add Bermuda To ‘Tax Blacklist’
[Updated] The European Union is reportedly set to add Bermuda to their blacklist on Tuesday, according to a report today [March 11] from Reuters, while Bloomberg is reporting that “the United Arab Emirates, Bermuda, and several other jurisdictions are holding last-minute negotiations with the European Union to avoid being added to the bloc’s tax haven blacklist.”
Background
In 2017, the Council of the European Union named 17 jurisdictions as “non-cooperative tax jurisdictions”; with American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia and the United Arab Emirates included on the original list, with the list changing as nations meet commitments set by the EU.
Bermuda, while not listed as a “non-cooperative jurisdiction,” was placed on a secondary list along with over 60 other nations and territories.
Citing the “existence of tax regimes that facilitate offshore structures which attract profits without real economic activity,” the Council said “the following jurisdictions are committed to addressing the concerns relating to economic substance by 2018: Bermuda, Cayman Islands, Guernsey, Isle of Man, Jersey and Vanuatu.”
In December 2018, MPs passed the Economic Substance Bill 2018 in the House of Assembly, with the Bill, which was aimed at addressing the EU concerns, receiving bipartisan support.
The Bill’s explanatory memorandum states it “imposes an obligation on an entity that is engaged in a relevant activity to maintain a substantial economic presence in Bermuda and, in that regard, comply with economic substance requirements.”
Last week Reuters had reported that the EU added 10 jurisdictions to a draft tax haven blacklist, including Bermuda, and they were “still considering whether Bermuda and the UAE will be added.”
Report
In a new report released today, Reuters said, “European Union finance ministers are set to add the British overseas territory of Bermuda to the bloc’s blacklist of tax havens on Tuesday but Italy is objecting to the inclusion of the United Arab Emirates, a document seen by Reuters shows.
“The largest review of the list since its adoption in Dec. 2017 is expected to see the number of listed jurisdictions triple from the current five.
“The 28-nation EU set up the blacklist after revelations of widespread tax avoidance schemes used by corporations and wealthy individuals to lower their tax bills.
“Blacklisted jurisdictions face reputational damage and stricter controls on their financial transactions with the EU, although no EU sanctions have yet been agreed by European states.
“Britain had pushed other EU states not to include Bermuda on the list, but has lifted its objections after the European Commission argued that the island has ‘been playing games’ to dodge EU requirements, according to minutes of a meeting of EU envoys on the matter.
“Bermuda was required to change its tax rules by the end of February, but added new loopholes in revised legislation and did not provide a final text by the deadline, the Commission said according to the document.”
This has not yet been officially announced by the EU, and we asked the Bermuda Government for comment and will update if able.
Update 5.00pm: Other international media outlets are also reporting this now, with Politico and the Financial Times also reporting that Bermuda appears likely to be added to the EU blacklist.
You can read the full story here on Reuters.
Premier’s Response
Update 9.18pm: Premier David Burt today indicated that the Government is aware of reports from Brussels suggesting that Bermuda is to be added to the European Union’s list on non-cooperative tax jurisdictions.
The Premier said: “We have been monitoring events closely for several days and have continued to engage at the highest levels of the various groups within the EU that play a role in the decision-making process.
“Our message has been a clear and simple one: Bermuda is compliant and met the required standard before any recommendations were considered.
“We have had some support in making that case and we have spared no efforts in doing so. Tomorrow’s meeting is an important one and we are preparing for any outcome.
“Bermuda remains a jurisdiction of choice and our reputation of sound regulation and adherence to the highest standards has been validated across many assessments over several years.
“We are confident that whatever the outcome of tomorrow’s meeting in Brussels, the reputation will be maintained and an economic substance regime, compliant with the EU’s requirements, will continue to be implemented.”
“Bermuda was required to change its tax rules by the end of February, but added new loopholes in revised legislation and did not provide a final text by the deadline, the Commission said according to the document.”
So this is due to a missed deadline by our Government? Guess they hired the wrong insider consultants for the job.
25-11
Funny how the EU is the prodct of the Berlin Conference which divided Africa up like a sliced pie and RAPED Africa of its rich resources, animals and PEOPLE and Colonized habited lands around the world like a “free for all take over”, and now want to act as a moral adviser.
Oh the GALL!!!!!!!!!!!!!!!!
Deflection, deflection, deflection. Typical.
Cant deflect from the Truth of History.
I know ot hurts so deal with it.
Hows it go OJ? Remind me. “Shut De Island down LMFAO” or something like that.
More recent history tells us that the plp are incompetent and have no idea how to mange money and simple things like a bus schedule or trash pick up. Present day tells us that nothing has changed in the last 5-6 years. A plp minister suggested that whoever was responsible for maintaining fire hydrants should do a better job.
And de Tea Party said de same thing about Obama and Vetoed everything he did, but I get it, only a certain segment of people are competent run this World and look where it has got us.
Get over it already.
Um you call people surrogates not me. I do not judge by color…you do.Tea party are not here why would you bring them up?
Its de same mindset, we all judge by colour, I guess ya colour blind too. So why is it Blacklist not whitelist.
Like Blackballed, Black sheep of the family, Black Market, BlackMail Black Magic etc, etc.
Living in denial is a sickness.
PS
Surrogates was in de UBP Secret Letter.
Duhhhh
There’s literally something wrong with you. Keep it up. My day goes by faster when I laugh.
“The term originated from the occasional black sheep which are born into a flock of whitesheep due to a genetic process of recessive traits. Black wool was considered commercially undesirable because it could not be dyed.”
You brighten my day, princess.
Black Friday is the best business day of the year.
Maybe we should ban the word black? That way when someone uses the word blackmail OJ wouldn’t think we’re talking about him.
You Fox supporters missed de whole point, like MLK said sincere ignorance and conscientious stupidity is dangerous.
“Living in denial is a sickness.”
How’s your fever, OJ?
You have 25-11 and you’re screwing it up. Bob Richards never got into this type of mess. What the frik is Renee doing?
It’s not true at all. It’s utter crap.
Hahahaha!! Is this the type of talk we have Renee Webb out in Brussels spewing?! Not a good strategy, see how far she gets!!
I’ll buy your ticket if you want to go back.
The problem here is that OJ isn’t necessarily wrong, but it’s his motivations that are suspect.
He doesn’t want to fix the problems and inequality he rails against, he just wants to be the one in charge of it. He wants to be the oppressor, rather than getting rid of oppression.
So much for the Brussels office
but our premier told us this would not happen ?
He probably said that whilst travelling.
Well done voters.The circles are starting to collide.
“European Commission argued that the island has “been playing games” to dodge EU requirements”
not everybody has the same humor as our brilliant Premier Burtcoin.
in other words even more EU companies ( IB ) will leave the island .
but we don’t need them , we have our Fintech industry which will cover all the job losses immediately.
it is a shame …………
“European Commission argued that the island has “been playing games” to dodge EU requirements”
If true that would be very worrying, not only for the EU but for all international business in Bermuda that relies on Bermuda’s reputation as a first class business jurisdiction.
They are here for tax reasons primarily. It certainly is not for our high cost of living, draconian immigrations laws and geographic isolation.
What about the fact that Bermuda is one of the top insurance and reinsurance jurisdictions in the world?
There is more talent here than almost anywhere else.
The talent came initially for tax reasons. They can coalesce in another location. Maybe one where long term immigrant employees and the children can get Status.
The actuary talent have no real loyalty to Bermuda and Bermuda never really took them in and offered any chance of Belonger Status.
More Bermuda for the Bermudians.
It was already said by someone. If that happened the plp would never be re-elected….like they’re bad for Bermuda or something.
I want to play a game.
Who said this:
“I have scores to settle”
“I will bring this island to its knees”
Mr premier and govt. You are not big enough (nor will you ever ever be) to dictate nor play silly games with a powerhouse like the EU. or USA or any major power. You may not like it but rules are rules and are to be followed not toyed with. Where as your intentions may be honorable and nobel and with some validity it is up to you to be upstanding and forthright and TIMELY, honest and show the integrity of this island. The silly little office in Brussels is but a grain of sand to them. Get this sorted fast or we will sink faster than the Titanic.
So just lay down and play dead without putting up a fight.
No. Communicate effectively. Something you lot have no idea about.
What the f is Renee doing? She’s there two months and it’s screwed up.
Regardless of how this is spun locally–and it will be–this is an optical problem for Bermuda.
You can say that the list is unfair or politically motivated but the fact is that Bermuda is potentially on a BLACKLIST.
We have traded on our Blue Chip reputation for years. If this comes to pass, we can longer say this.
If the other Ot’s and CDT’s are not on that list–then new business will by pass us to go to them.
I would like to know who was responsible for this and how we missed the mark so widely thinking we could skate by..
The house has won on this bet!!!
Don’t be too proud to ask for help. Bob Richards and Grant Gibbons come to mind.
Arrogant Bob Richards and Gibbons? Seriously?
Why not? Burt is incapable of handling it. Get some people who know what they’re doing.
Because he said money doesn’t grow on trees? Poor old fella. It grows on trees in the billions in Colorado. Once again Bermuda has its thumb in its bum while the rest of the world moves on and we have to sit and wait to see if it’s ok.
give me a break…you really think legalising weed will fix the economy?
No but it would help. Clearly we won’t see the billions Colorado does but assuming it will fix the economy is about as stupid as those lot that think the Americas cup was supposed to make everyone rich.
Lmao Gibbons is the last person to be arrogant if you truly knew him! Smarter than all in the plp combined bra…
The Reuters story says that the EU regulators allege that PLP Gov has been “playing games” … gosh who’d a guessed that?
International Business MUST Go !!!!!
this all can be avoided/solved
send IB packing
Yet another WTF ? post from you .
Wow. Absolutely scary that you can vote as who in their right mind would want to rid the island of an industry that provides the vast majority of our GDP. Do you understand what would happen to BDA and her people if that actually happened? Do you care?
That fool is Caymanian!!
Dont mind the troll lmfao idiot
You have no idea what the implications of removing IB from Bermuda comes with. We would be another Jamaica shortly following. Please wake up!
Cayman is not on the list. The difference between Bermuda and Cayman is that Cayman has a competent Government. Bermuda seems to confuse arrogance for competence, especially at election time.
The Cayman people are not racist like Bermuda, more and more companies are headed that way.
Lol, that’s the criteria for the EU ! If it is they should concentrate on Europe first. I don’t know how we can be on the list and Cayman and the BVI aren’t. That can’t be right. Definitely need a lot more details about this before we can play the blame game.
Incompetent PLP. That’s the reason.
We will need all hands on deck to steady this ship over the next few months if this comes to pass and our competitors such as Cayman and the Channel Islands are not named to the EU blacklist.
Truthfully–if they are not–then there should be some real questions asked about how Bermuda finds itself in this position and the Gvt and its technical officers should be honest and transparent.
Our saving grace now is if the Bermuda CFATF review comes out better than the rest, then it will throw a bit of cold water on the EU list BUT right now the optics are terrible.
The Channel Islands will not be on the list. Their governments take a different view of things
Thanks Burt smhfh…..clueless
Although the review by onion juice is correct it is not going to help us one bit. Bob and Grant did not get it done and Bob gave them so choice words which upset them.as for our future a lot depends on Brexit and if the people of S David’s will finally secede.
With 25-11 and a full-time Brussels office staffed by an expert in speaking French, I’m shocked that the PLP government can’t do a better job of communicating effectively with the EU. When Bob Richards was finance minister things never got into a mess like this.
This is what happens when Burt refuses to meet with people.
I have no doubt about the ability of Renee Webb to effectively communicate with the EU. The question is, what is Ms Webb being told to communicate and does it correspond with reality?
Based on her results she is failing miserably.
I don’t think Ms. Webb can fairly be blamed for this. This sanction is based on our Economic Substance Act passed last December, before Ms. Webb was appointed
PLP think they are a superpower once they leave the 20 square miles we are a dot in the ocean we need the world not vice versa
Blacklist?…that is just so racist.
I wear deep tan sun lotion one time and this is what I get?
It’s not a completely done deal just yet, apparently. While it’s news for the moment, the list has not yet been published. Let’s not jump the gun until it’s out there formally. Hope springs eternal.
very true
Where’s Chris Famus to I bet he saves us
E….U….
The one question that has not been asked: will Bermuda ever be able to give the EU what it wants in this regard without losing all the advantages that being domiciled here offers?
My sense is not and the EU will just keep on moving the goal posts. Perhaps a different approach other than appeasement is the way forward?
Now, don’t shoot the messenger, just being realistic.
Economically more powerful jurisdictions will always apply pressure on Bermuda, BVI, Cayman and other island jurisdictions. That is not the point here.
Cayman, BVI, the Channel Islands and other jurisdictions all passed Economic Substance laws, as did Bermuda.
Only Bermuda is on the list of non-cooperative jurisdictions. Why?
Only Bermuda has been accused of “playing games” by the EU. Why?
OJ did it