Namibia still in tax haven dog box
Namibia is still listed as a tax haven by the European Union (EU), which announced at the weekend it would be removing certain countries from the unpopular list.
EU finance ministers are set to officially remove the Caribbean islands of the Bahamas and Saint Kitts and Nevis from its tax haven list next week.
The two islands were included on the blacklist in March, as their tax rules and practices were deemed not in line with EU standards.
After they committed to changes, EU tax officials recommended moving them and placing them on a so-called grey list of jurisdictions with low tax transparency standards, but aiming to become less opaque, an EU document shows. EU finance ministers are expected to formally adopt the removal decision next Friday, according to a draft agenda for a meeting and an EU official contacted by Reuters.
Seven other jurisdictions will remain on the blacklist, including Palau, Samoa, Trinidad and Tobago, Namibia and the three United States' territories of American Samoa, Guam and the US Virgin Islands. The EU blacklist was drawn up last December after several 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 sanctions have been agreed by states as yet.
Those who are on the grey list could be moved to the blacklist if they do not honour their commitments. Finance minister Calle Schlettwein and tax expert within the ministry, Nadine Du Preez, did not respond to queries sent, at the time of going to press.
When the list was initially published, Schlettwein hit out, calling the move to blacklist Namibia prejudiced, discriminatory and unjust.
Tax officials from the ministry of finance and the EU embassy have met to discuss the criteria.
Schlettwein said because questions asked by the ministry were not satisfactorily answered, both parties felt the need to extend the EU deadline.
“Due to miscommunication we missed that deadline, but that does not make Namibia a non-compliant country or tax haven,” Schlettwein said at the time.
“We are perplexed to learn the European Union has revealed the names of the non-cooperative.”
Tax officials would however hold frequent consultative meetings to find solutions around the problem, he added.
“We will find out from the EU mission here what can be done. We have arranged for a meeting with the EU ambassador. We will raise the issue at a diplomatic level to make sure our relationship will not be jeopardised,” Schlettwein said.
The Institute of Chartered Accountants of Namibia (ICAN) last year also disagreed with the EU's decision to list Namibia as a tax haven.
ICAN said the blacklisting is unfair.
“Tax havens are globally recognised as countries that offer offshore tax structures and arrangements, aimed at attracting profits without real underlying economic substance, and by offering very low income and transactions tax rates,” the institute's Koos du Toit said.
“Namibia offers no offshore incentives or arrangements attracting profits, without real economic substance whatsoever, and that there is no basis to justify Namibia's inclusion as a perceived tax haven.”
-Additional reporting by Reuters
OGONE TLHAGE
EU finance ministers are set to officially remove the Caribbean islands of the Bahamas and Saint Kitts and Nevis from its tax haven list next week.
The two islands were included on the blacklist in March, as their tax rules and practices were deemed not in line with EU standards.
After they committed to changes, EU tax officials recommended moving them and placing them on a so-called grey list of jurisdictions with low tax transparency standards, but aiming to become less opaque, an EU document shows. EU finance ministers are expected to formally adopt the removal decision next Friday, according to a draft agenda for a meeting and an EU official contacted by Reuters.
Seven other jurisdictions will remain on the blacklist, including Palau, Samoa, Trinidad and Tobago, Namibia and the three United States' territories of American Samoa, Guam and the US Virgin Islands. The EU blacklist was drawn up last December after several 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 sanctions have been agreed by states as yet.
Those who are on the grey list could be moved to the blacklist if they do not honour their commitments. Finance minister Calle Schlettwein and tax expert within the ministry, Nadine Du Preez, did not respond to queries sent, at the time of going to press.
When the list was initially published, Schlettwein hit out, calling the move to blacklist Namibia prejudiced, discriminatory and unjust.
Tax officials from the ministry of finance and the EU embassy have met to discuss the criteria.
Schlettwein said because questions asked by the ministry were not satisfactorily answered, both parties felt the need to extend the EU deadline.
“Due to miscommunication we missed that deadline, but that does not make Namibia a non-compliant country or tax haven,” Schlettwein said at the time.
“We are perplexed to learn the European Union has revealed the names of the non-cooperative.”
Tax officials would however hold frequent consultative meetings to find solutions around the problem, he added.
“We will find out from the EU mission here what can be done. We have arranged for a meeting with the EU ambassador. We will raise the issue at a diplomatic level to make sure our relationship will not be jeopardised,” Schlettwein said.
The Institute of Chartered Accountants of Namibia (ICAN) last year also disagreed with the EU's decision to list Namibia as a tax haven.
ICAN said the blacklisting is unfair.
“Tax havens are globally recognised as countries that offer offshore tax structures and arrangements, aimed at attracting profits without real underlying economic substance, and by offering very low income and transactions tax rates,” the institute's Koos du Toit said.
“Namibia offers no offshore incentives or arrangements attracting profits, without real economic substance whatsoever, and that there is no basis to justify Namibia's inclusion as a perceived tax haven.”
-Additional reporting by Reuters
OGONE TLHAGE
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