Sun, Apr 05, 2009 - Page 11 News List

‘Tax havens’ snap back at OECD

BLACKLIST: The OECD put four countries on a tax haven ‘blacklist,’ including the Philippines, Malaysia, Costa Rica and Uruguay, while others were put on a ‘gray’ list


Countries faulted by the Paris-based Organization for Economic Cooperation and Development (OECD) for their tax reporting standards snapped back on Friday, with some disputing their designation and others vowing to clear their names.

After the G20 summit in London agreed to crack down on tax havens, the OECD published three lists, one naming four countries it said had not pledged to abide by international tax reporting norms.

A second list named territories that had committed to such standards but not yet fully implemented them and a third list identified 40 countries that had substantially implemented them.

The OECD, which seeks to coordinate the economic polices of its 30 industrialized members, placed the Philippines, Malaysia, Costa Rica and Uruguay on the blacklist.

The second list had 38 names, including EU members Austria, Belgium and Luxembourg along with Switzerland and Liechtenstein.

Uruguayan Finance Minister Alvaro Garcia wrote to OECD Secretary-General Angel Gurria and formally endorsed the organization’s tax reporting standards, prompting the OECD on Friday to remove the country from the blacklist.

“The OECD welcomed today the formal endorsement by Uruguay of its tax information exchange standards,” it said in a statement published on its Web site.

The Philippines insisted it had one of the world’s strictest banking secrecy laws and said it was “unfortunate” that it had been designated as having failed to meet OECD criteria.

“We are committed to compliance with those standards and we are confident that we will meet the requirements for removal from this list,” Cerge Remonde, a spokesman for Philippine President Gloria Arroyo, told reporters.

Malaysian Prime Minister Najib Razak said on Friday the country should not have been included on the first list as it is committed to global OECD tax standards.

In Europe, Luxembourg, Switzerland and Belgium complained of their inclusion on the middle tier — or “gray” — list.

“I think that the treatment given to some countries is a bit incomprehensible,” Luxembourg Prime Minister Jean-Claude Juncker said as he arrived to chair a meeting of eurozone finance ministers in Prague.

Juncker renewed criticism of the way the lists were drawn up, noting that several US states with tax-friendly laws were not listed at all.

He had said on Tuesday that if Luxembourg were placed on any international list of offshore financial centers, then Delaware, Nevada and Wyoming should also be named and shamed as tax havens.

The Swiss Finance Ministry issued a statement saying that “President Hans-Rudolf Merz regrets this procedure.”

“The list does not specify the criteria on the basis of which it was drawn up. Switzerland is not a tax haven,” it said, adding that it was “particularly strange” that Bern was not consulted on drawing up the list even though it was an OECD member.

Belgian Finance Minister Didier Reynders said it was not “very pleasant to be on a list that also included tax havens,” adding that Belgium could be cleared once it signs agreements on the exchange of financial information with 12 countries.

This story has been viewed 3660 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top