Oman’s position in a European Union (EU) blacklist of countries alleged to be tax havens seems set to remain unchanged even as its neighbour UAE along with Switzerland and the Pacific nation of Marshall Islands are set to be removed.
According to an official EU document, cited by Reuters, the countries will reportedly be removed from the list on October 10.
The EU blacklist and a grey list had been set up in December 2017 after avoidance loopholes used by corporations and wealthy individuals to lower their tax bills came to light.
Oman was added back to the list in March 2019 for not making sufficient progress in signing up to or implementing exchange of information protocols, according to a report.
The Sultanate’s Ministry of Finance had expressed regret over the inclusion and had stressed in a twitter statement in March that it would continue to communicate with the EU to enhance cooperation between the tax authorities, although some of the standards are not complete “due to the legislative cycle in force in the Sultanate”, adding that the Sultanate will continue working towards meeting the required standards.
Oman has already completed the procedures for membership in the General Framework Program for Corrosion of Containers and Transfer of Profits in October 2017 and procedures to join the Global Forum for Transparency and Exchange of Information on Taxation in October 2018, which is a requirement of the European Union.
Oman is also working on the required procedures with regards to direct exchange of information and also the Mutual Administrative Assistance Agreement on Tax Matters, the statement added.
The UAE was added to list for not making sufficient progress in implementing economic substance regulations by the agreed deadline of Dec. 31 2018. It was included in the original EU blacklist in 2017, but was subsequently moved to the EU greylist in January 2018 after committing to meet the standards required by the EU.
According to the EU report cited by Reuters, The UAE, the largest financial centre still on the list, is due to be removed because it adopted new rules on offshore structures in September. The Gulf state charges no corporate taxes, making it a possible target for firms seeking to avoid paying tax in the countries where they actually operate.
The lists are regularly reviewed to take account of overhauls or to add new jurisdictions.