Note: this is just a translation of a news article appearing in La Prensa newspaper in Panama on 23 January 2018. The article is authored by Victoria Isabel Cardiel C., and is property of Grupo Corprensa. The British Chamber of Commerce in Panama does not claim ownership of the contents of the article, only the translation presented below.
The Panamanian government highlighted that the removal of the country from the tax haven blacklist happened “in record time”.
The Economic and Financial Affairs Council (ECOFIN) of the European Union agreed to remove Panama from the tax haven blacklist in December.
Alongside Panama, seven other jurisdictions have been eliminated from the list: South Korea, United Arab Emirates, Barbados, Grenada, Macao, Mongolia, and Tunisia.
The Ministers of Economy of the 28 member states of the European Union have stated that their declassification is “justified” by “expert analysis on the assumed commitment by these jurisdictions to tackle the deficiencies identified by the EU”.
As such, they have highlighted the commitments received “on a high political level” as their main reasoning to resolve the doubts of the block.
Panama submitted a letter to the European Union a few weeks ago containing said promises, but its contents have not been published.
“Our process for making the list is already demonstrating that it is worthwhile. Jurisdictions from all over the world have worked hard in order to make commitments to reform their fiscal policies. Our objective is to promote good global governance,” indicated Vladislav Goranov, the Minister of Finance of Bulgaria, who currently holds the presidency of ECOFIN.
ANOTHER LIST
In this regard, Panama goes from being classified in Annex I- non-cooperative jurisdictions to Annex II- cooperative jurisdictions in accordance with assured commitments.
This list includes 55 states that have promised to modify their fiscal norms in order to conform to European and international standards throughout 2018.
The Ministers of economy and finance will review at the end of the year, the promises made by the country in order to verify if it has complied with the assured commitments. If it is a case of non-compliance, it would return the European Union’s tax haven blacklist.
GOVERNMENT VALUES RECOGNITION: PANAMA COMPLIES
The Panamanian government highlighted that the country’s exit from the tax haven blacklist has happened “in record time, within two months of its incorporation.”
In a release given in parallel to that which was given in Brussels, [the Panamanian Government] placed value upon the “technical, political, and diplomatic work that elaborated and clarified those technical elements of Panamanian fiscal policy that would be required by the international standards for fiscal and financial transparency”.
As confirmed by European sources, Panama signed on “at the highest political level”, expressing its wish to resolve the problems that were identified by the European Union. Panama has been included because it was considered to have a harmful preferential tax regime.
With respect to the strides made in terms of fiscal policy, the government emphasised that “the Republic of Panama has come to execute a roadmap, approved by the High-Level Commission for International Financial Services (CANSIF, by its Spanish acronym), where the private sector participates, and whose objective is to assure the country’s competitiveness and its compliance with the highest global standards in fiscal and financial matters”.
“The decision that we are celebrating today reaffirms the recognition by the European Union that Panama thoroughly complies with the international standards for fiscal and financial transparency”, highlighted Isabel de Saint Malo de Alvarado, the Vice President.
From his part, the Minister of Economics and Finance, Dulcidio De la Guardia, who chairs over CANSIF, expressed his pleasure over the “effectiveness of the Panamanian technical, diplomatic, and political efforts that achieved the rapid exclusion of Panama from the list, and avoided that European countries impose discriminatory measures against Panama for this reason”.
The Panamanian President, Juan Carlos Varela, showed his satisfaction over the decision, and at the same reaffirmed Panama’s commitment to continue to abide by the highest international standards in matters of transparency.
