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What Is A White Listed Country?


What Is A White Listed Country?The Organisation for Economic Co-operation and Development’s (OECD) Global Forum on Transparency and Exchange of Information has developed standards of transparency and exchange of information together with the cooperation of non-OECD countries.  These standards are perceived as the international norm for tax cooperation and are part of the ongoing attack on uncooperative tax havens.

Tax Havens

The OECD identifies four key factors in considering whether a jurisdiction is a tax haven:

  1. Nil or only nominal taxes are imposed to attract non-residents who wish to escape high taxes in their country of residence;

  2. There are no substantial activities of the tax payer in that jurisdiction;

  3. There is protection of personal financial information against scrutiny by foreign tax authorities; and

  4. There is a lack of transparency in the operation of the legislative, legal or administrative provisions.

A jurisdiction is said to be a tax haven if some, but not necessarily all, of the above features are present. However, there is no specific or confirmed definition of a tax haven.

White, Grey and Black Lists

Based on the internationally agreed tax standard, the OECD has formulated “white”, “grey” and “black” lists.

  • White List – jurisdictions that have implemented the internationally agreed tax standard – i.e. not considered to be a tax haven by the OECD.

  • Grey List – jurisdictions that are committed to the internationally agreed tax standard but have not yet substantially implemented this standard – i.e. may meet some of the above mentioned tax haven criteria.

  • Black List – jurisdictions that have not committed to the internationally agreed tax standard – i.e. no steps have been taken by the jurisdiction to cooperate with the OECD to implement the standard.

The OECD published a report on 18 May 2012 on the progress made in relation to jurisdictions implementing the internationally agreed tax standard; the report lists all white, and grey listed jurisdictions.  There were no black listed countries on this date.  

Tax Inspectors Without Borders

In May 2012, the OECD indicated that the Task Force on Tax and Development had launched a new initiative, namely Tax Inspectors Without Borders / Inspecteurs des impôts sans frontiers, to help developing countries strengthen their domestic revenues by making their tax systems fairer and more effective. The OECD have also indicated their intention to establish an independent foundation that will provide international auditing expertise and advice to help developing countries address tax base erosion, including tax evasion and avoidance. 

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