European Union finance ministers are set to remove the Caribbean islands of the Bahamas and Saint Kitts and Nevis from an EU list of tax havens next week, EU documents show, Reuters reports.
The two islands had been included in the blacklist in March as their tax rules and practices were deemed not in line with EU standards.
After they committed to changes, EU tax officials recommended moving them from the blacklist to a so-called grey list of jurisdictions with low tax transparency standards but aiming to become less opaque, an EU document shows.
EU finance ministers in a regular meeting on Friday next week are expected to formally adopt the removal decision, according to a draft agenda of the meeting and an EU official contacted by Reuters.
Seven other jurisdictions will remain on the blacklist. They are Namibia, Palau, Samoa, Trinidad and Tobago and the three United States’ territories of American Samoa, Guam and the U.S. Virgin Islands.
The EU blacklist was set up last December after several revelations of widespread tax avoidance schemes used by corporations and wealthy individuals to lower their tax bills.
Blacklisted jurisdictions could face reputational damage and stricter controls on their financial transactions with the EU, although no sanctions have been agreed by EU states yet.
Those who are on the grey list could be moved to the blacklist if they do not honor their commitments.