On 08.10.2024, the EU Council published an updated list of countries that do not cooperate in tax matters. While there are no new entries, one jurisdiction, Antigua and Barbuda, has been removed, and the list for the next six months now includes:
American Samoa, Antigua, Fiji, Guam, Palau, Panama, Russia, Samoa, Trinidad and Tobago, U.S. Virgin Islands, and Vanuatu.
EU Council List of Non-Cooperative Jurisdictions
From this list, Panama and Russia may be particularly relevant for Estonian taxpayers, as they are countries where business relations or company participation might occur. In such cases, certain tax obligations may arise for Estonian residents (both legal entities and individuals).
Namely:
• If an Estonian legal entity purchases services from companies in these jurisdictions, income tax must be withheld on the payments made for the services.
• Individuals are required to declare their participation in companies in these countries and report as personal income the proportionate share of profits, even if the profits were not distributed, if the company is considered “controlled” by the Estonian resident (Income Tax Act §22).
It is also important to note that dividends received by Estonian companies from companies in countries on this list are not exempt from taxation.