Marshall Islands aims to leave tax haven blacklist
The Republic of the Marshall Islands (RMI) has vowed to get itself off the EU’s new blacklist of tax havens.
The superyacht registry says that it is working with the EU to find out why it has been included on the list and to maintain fair and transparent taxation standards.
And a superyacht lawyer has warned that lenders might be wary of financing superyacht transactions on vessels registered in these blacklisted countries due to increasing scrutiny on financial structures in tax havens.
The EU blacklist is a list of 17 countries that have failed to meet its tax good governance standards. By drawing up the list, the EU hopes to crack down on tax havens and raise the level of transparency and fairness in financial reporting. Alongside the blacklist is a “grey list” of 47 other countries that have already agreed to change their tax systems to be in line with EU requirements.
A spokesperson for the RMI, which is one of the biggest registries for US owners, told Superyacht Investor that the Republic had cooperated with the EU and remained committed to implementing its tax guidelines.
He said: “The RMI cooperated with the EU, reiterating its existing commitments to tax transparency and committing at a high political level to implement any relevant anti-base erosion and profit shifting (anti-BEPS) minimum standards and to cooperate with the EU to understand and develop solutions regarding the EU’s fair taxation concerns.
“The RMI is committed to continuing to seek meaningful dialogue with the EU in order to understand the basis under which the RMI was listed and to secure its removal from the EU’s list.”
James Jaffa, associate at law firm Gateley Plc, thinks that the RMI would be disappointed at being on the list, when other countries weren’t included.
He didn’t think that the move by the blacklist would affect existing owners, but added: “Later down the line, it might make people think twice about going to one of these blacklisted countries when registering new yachts, particularly the Marshall Islands as it is one of the big registries, especially for US owners.
“With the mainstream lenders these days, there is increasing scrutiny on financing structures and tax arrangements and I imagine lenders will be more critical towards flagship registries in these blacklisted countries and possibly in the grey listed countries.”