Report: EU Considers Adding Turkey to Blacklist of Tax Havens

EU is contemplating to include Turkey on its blacklist of tax havens in a step that would take effect as soon as next month and could further add tension to already strained ties.

“An EU working group tasked with screening “non-cooperative jurisdictions for tax purposes” concluded that Turkey’s commitments to address transparency issues and sweetheart tax regimes are so far “not sufficient,” according to a report by Bloomberg.

The Code of Conduct, which carried out screening the countries and looked into loopholes and shortcomings that exist, would suggest adding non-compliant countries to the blacklist early in December at an EU summit.

Any inclusion of Turkey on the list could inflict a damage to the country’s struggling economy amid a tumbling lira, a soaring inflation and apparent political interference by President Recep Tayyip Erdogan in workings of the independent Central Bank.

Investors would be more hesitant and reluctant to think Turkey for investment if EU takes such a decision, Bloomberg added.

Turkey was quick to react to the Bloomberg report. Turkish Finance Minister Naci Agbal said it was out of the question for the bloc to include Turkey in a blacklist of tax havens, according to Reuters.

He said Turkey promised last week that it would soon complete secondary tax regulations in a bid to ward off any EU move.

In remarks to Reuters, the Turkish finance minister underlined that “Turkey was fully in line with and backing all international tax agreements.”

“Turkey fully abides by international tax agreements and backs them. Last week, we wrote a letter to the EU and explained that we were carrying out work on secondary regulations, and promised it would be completed soon,” Reuters quoted him as saying.