Article: The EU’s Uncoordinated Approach to Tax Avoidance and Tax Abuse in Relation to ‘Uncooperative’ Tax Jurisdictions

Abstract

The European Union (EU)’s external tax policies in relation to ‘uncooperative’ tax jurisdictions are predominantly shaped by the case law of the Court of Justice of the European Union (CJEU), the Member States’ domestic tax laws and, most recently, the EU list of non-cooperative jurisdictions for tax purposes (EU blacklist). Research in academia scholarship has assessed the EU blacklist from various angles. The objective of this article is to contribute to this discussion by contextualizing the EU blacklist with the relevant CJEU case law on anti-avoidance and antiabuse provisions applied in third country situations. Beyond an assessment from a doctrinal perspective, particular emphasis is placed on related tax policy issues. This combined evaluation yields three primary conclusions: the EU blacklist’s soft law character allows the Member States to continue to take advantage of type-casted and irrebuttable anti-avoidance and anti-abuse provisions in light of the CJEU case law; the EU blacklist’s inability to meet its initial objectives can be explained by political dynamics at the EU level; and the EU blacklist might relieve some of the currently manifesting symptoms without addressing the fundamental flaws in the international tax system. CJEU case law, developing countries, EU blacklist, EU external tax policies, free movement of capital, harmful tax competition, mutual assistance, tax abuse, tax avoidance