European Union blacklists UAE: Will this impact business? (source: Khaleej Times)

 On December 5, 2017, European Union announced the list of blacklisted global tax haven countries including the United Arab Emirates.

The EU originally examined 92 jurisdictions and has worked hard to finalize the list. There were different views and perceptions on this action by the EU. Some says that the decision was politically led while some supported it and are willing to adhere to tough measures against the listed tax havens.

The countries on the list are American Samoa, Bahrain, Barbados, Grenada, Guam, Macau, the Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, South Korea, Trinidad and Tobago, Tunisia and the United Arab Emirates.

On the other hand, according to the news published by The National on December 6, 2017, “UAE based wealth managers have said that the move made by EU to include the UAE in the blacklist of 17 global tax havens is not credible and likely to have a negligible effect on the banking industry which has in recent years intensified efforts to clamp down on financial crime”.

The Chief Executive officer of Emirates Investment Bank, Mr. Khaled Sifri, had also shared his thoughts when interviewed by The National and said that the blacklist seemed more of a political exercise than an objective undertaking that judged jurisdictions on specific criteria.

Mr. Khaled Sifri has added that the biggest offenders are not on the list. Switzerland, Jersey and the US are some of the biggest offenders around. This is the kind of thing that may attract attention in the short term but it will have no implications in the longer term.

However, the United Arab Emirates remains committed to maintaining the highest standards of tax regulations and would continue to work hard and strengthen its relations with the international partners to ensure compliance. The government is dedicated to reform process that is expected to be finalized in October 2018.