The country is one of the 30 globally and five in the Pacific (Nauru, Niue, Marshall Islands and Vanuatu) on its first list of international tax havens.
Cook Islands’ Financial Services Development Authority chief executive Tamatoa Jonassen says the blacklist is inexplicable’in terms of transparency and information sharing.
He added it was difficult to comment further in the absence of any clear information on the basis upon which jurisdictions were chosen to be blacklisted.
“No official in the Cook Islands had been approached by European Union officials on these listings,” Jonassen says.
He says since 2009, the Cook Islands has signed tax information exchange agreements (TIEA) with 20 countries, half of which are member countries of the EU.
Out of the 28 EU member states, only 10 have listed the Cook Islands and of these 10, two (Greece and Italy) have signed TIEA’s with the Cook Islands.
Spain, a member of the EU, has agreed and is waiting to sign, he says, adding the Cook Islands is awaiting the response of another member (Portugal) on initial communication.
Tamatoa acknowledged the move towards automatic exchange of information for tax purposes, but added the Cook Islands was fully supportive of this change.
“This included a change in the law in 2013 to require offshore entities to retain full accounting information within the Cook Islands.”
The Commission has also presented its ‘Action Plan for Fair and Efficient Corporate Taxation in the EU’, setting out a series of initiatives to tackle tax avoidance and secure sustainable revenues.
In responding to the Commission’s Action Plan, Jonassen said the objectives of the plan in regard to transparency on taxation needed to be coherent with those outlined in the Global Forum process.
Both the Cook Islands and the European Union are members of the Global Forum.
“The Cook Islands is committed to promoting international cooperation in tax matters,” Jonassen says.
“We recently received a positive report from our Phase Two Peer Review by the Global Forum on Transparency and Exchange of Information for Tax Purposes.”
The EU blacklist is made up of countries that figure on at least 10 national lists of tax havens compiled by the 28 member nations.
It is part of a crackdown on multinational companies trying to avoid paying tax.
The EU wants to end special tax deals involving firms such as Amazon, Apple and Starbucks.
EU Economic Affairs Commissioner Pierre Moscovici says the publication of the blacklist is a decisive step that will push non co-operative non-EU jurisdictions to be more co-operative and adopt international standards.
The full list is: Anguilla, Antigua and Barbuda, Bahamas, Barbados, Belize, Bermuda, British Virgin Islands, Cayman Islands, Grenada, Montserrat, Panama, Saint-Vincent and the Grenadines, Saint Christopher and Nevis, Turks and Caicos Islands, U.S. Virgin Islands, Andorra, Guernsey, Liechtenstein, Monaco, Liberia, Mauritius, Seychelles, Brunei, Hong Kong, Maldives, Cook Islands, Nauru, Niue, Marshall Islands and Vanuatu.