The European Union has removed St Kitts and Nevis from its list of nations it considered fertile for tax crimes.
The de-listing of the Caribbean federation took effect on Friday, 25 May.
This move was widely expected, as WIC News reported earlier in May.
The Economic and Financial Affairs (ECOFIN) Council’s Code of Conduct Group on Business Taxation – the working group responsible for the listing process – decided that St Kitts and Nevis should be moved from Annex I to Annex II (de-listed).
Annex I is the EU’s list of non-cooperative jurisdictions for tax purposes, whereas Annex II comprises jurisdictions that have made commitments to implement tax good governance principles.
St Kitts and Nevis has committed to amend the relevant legislation to address the EU’s concerns regarding preferential tax regimes by the end of December 2018, according the prime minister’s office.
“The federation remains committed to the implementation of the various international standards and has exhibited its commitment by joining the Organisation for Economic Co-operation and Development’s (OECD’s) Inclusive Framework on Base Erosion and Profit Sharing (BEPS),” said a statement.
“The BEPS Inclusive Framework comprises over 100 jurisdictions that are collaborating on the implementation of the OECD/G20 anti-BEPS Package.
“The Package aims to tackle BEPS practices, which refer to tax avoidance strategies that involve artificially shifting profits to low- or no-tax locations.”
St Kitts and Nevis has also signed the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters.
Prime Minister Timothy Harris signed up to this regulation in Paris, France, in August 2016.
The Federation is a member of the Global Forum on Transparency and Exchange of Information for Tax Purposes – the premier international body that ensures the implementation of the international standards on tax transparency.
The country is deemed by that body to be “largely compliant.”