Tax havens, high-risk countries and non-cooperative territories

Tax haven

A tax haven It is a territory, usually a State, whose tax regime is characterized by low or no taxes, and in which, in addition, there may or may not be a certain opacity in the banking system. These paradises are legally defined by Royal Decree 1080/1991, of July 5, modified by Royal Decree 116/2003, of January 31, and are the following:

The countries and territories to sign an information exchange agreement with Spain in tax matters or an agreement to avoid double taxation with an information exchange clause will no longer be considered tax havens. at the time when said conventions or agreements come into force. Hence, the original list of tax havens has been reduced in recent years.

High risk countries

The high risk countries are based on Article 9 of Directive (EU) 2015/849, according to which the Commission has the mandate to identify high-risk third countries that have strategic deficiencies in its regime to combat money laundering and the financing of terrorism. The aim is to protect the integrity of the EU financial system. According to Commission Delegated Regulation (EU) 2021/37 of 7 December 2020, which modifies Delegated Regulation (EU) 2016/1675, countries with strategic deficiencies are the following: 

Non-cooperative countries and territories

Finally, with the aim of improving international tax governance and tackling unfair tax competition, the EU and in particular the Council adopted a list of non-cooperative countries and territories for tax purposes in 2017. This list, which is updated twice a year, serves to address:

• to tax fraud or evasion: illegal non-payment or underpayment of taxes,
• to tax avoidance: resorting to legal means to reduce tax debt,
• to money laundering: the concealment of the origin of money obtained illegally.

The list includes the non-EU countries encouraging abusive tax practices, which affect the corporate tax revenues of the Member States. The latest list adopted by the Council on 02/22/2021 includes:

By jointly identifying these countries, Member States can act together to lobby for reforms. The goal is not to single out countries, but to encourage positive change in their tax laws and practices through cooperation.