Opposition lawmakers have expressed concern over reports that European Union ambassadors recommended the Cayman Islands be blacklisted as a non-cooperative tax jurisdiction.
It comes after the Financial Times reported Wednesday that EU27 ambassadors decided to place Cayman on a list of nine territories that do not effectively cooperate with the European bloc.
The decision comes just two weeks after the UK, Cayman’s lone defence at the EU table, formally left the bloc.
Cayman is the only British Overseas Territory to face blacklisting.
European finance ministers are set to meet on Tuesday, 18 Feb., to confirm the decision.
“While this is only a recommendation at this time, we believe that it is imperative that an immediate action plan be drawn up to deal with all eventualities,” Opposition spokesperson on financial services Bodden Town West MLA Chris Saunders told the Cayman Compass Thursday.
Cayman has held numerous discussions and made several legislative changes to address concerns raised by the EU leaders to avoid inclusion on the tax blacklist.
Cayman and British Virgin Islands were up for review after being placed on a EU ‘grey list’ in 2018. In a statement following the Financial Times report, government said it has yet to receive confirmation of the EU decision.
“We believe that we have introduced the appropriate legislative changes to enhance our regulatory framework, in line with the EU’s requests,” the statement read. Government, it said, has offered to make itself “available for further dialogue or clarification with the Commission and the EU Ministers of Finance”.
Saunders said Leader of the Opposition Arden McLean has reached out to Premier Alden McLaughlin to get an update on how the government will respond if the recommendation is accepted by the EU finance ministers next week.
“At this point, the Opposition believes that the interests of our country are best served with everyone working together to ensure that the Cayman Islands is not blacklisted. And while it is important for us to understand what actions or inactions brought us here, this is not the time to find blame, but to work together to ensure the prosperity of our financial industry,” Saunders said.
Government contended, in its statement, that over the past two years, it has adopted a number of “fundamental legislative changes to enhance tax transparency and cooperation with the EU, fully delivering on our commitment to strengthen our regulatory regime and addressing the concerns reflected in the EU Council conclusions of 12 March 2019”.
Countries on the proposed EU blacklist
- Cayman Islands
- Trinidad and Tobago
- US Virgin Islands