The EU Council has published the new list of countries that do not cooperate on tax matters

This list is published twice a year and has practical interest to the Estonian taxpayer since some transactions with companies from countries listed may lead to taxation of payments even if they had a business purpose, and the companies recipients were engaged in real economic activities.

Particularly, in the world a huge number of ships sail under the flags of the Marshall Islands and the British Virgin Islands, still, payment for services to such company was accompanied with tax withholding and tax payment at the standard Estonian tax rate. This requirement lasted from 02/14/2023 (adding these countries to the list) until 10/17/2023 (the publication of a new list).

The new list contains 16 jurisdictions. It excludes the above-mentioned Marshall Islands, British Virgin Islands, Costa Rica, and includes Antigua and Barbuda, Belize and the Seychelles.

Now, before new publication released, you should be guided by this list:

https://www.consilium.europa.eu/en/policies/eu-list-of-non-cooperative-jurisdictions/?fbclid=IwY2xjawGQL7hleHRuA2FlbQIxMAABHWx6HtJHxj14EOlsjK_Unj_Fz5TM80X0o4fww0uHr1HrY2dX5ApTqQFTYA_aem__usvZfD5z4NKYdfbhwoWGg

It should also be remembered the need for individuals to declare their participation in the enterprises of these countries and to declare as a personal income a part of the profit proportional to their share in such enterprises, even if this profit was not distributed in case the enterprise is considered to be “under the control” of Estonian resident (§ 22 of the Income Tax Law).


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