SPAIN is lobbying for Gibraltar to be included on a European Union list of global tax havens, while simultaneously calling for Andorra to be struck from the list. The list, published last week, details 30 states which European nations view as uncooperative on tax legislation, including the Cayman Islands and Bermuda.
A state must receive nominations from 10 EU nations to be noted on the document, and Gibraltar has been fingered by nine countries, one of which is Spain. Spanish finance minister Cristobal Montoro has reportedly complained, saying there is “more than enough reason” to add Gibraltar. Regarding Andorra, he said the inclusion of the state with which Spain has agreements on double taxation, made “no sense.”
Earlier this year, Gibraltar’s Chief Minister Fabien Picard called out Ed Miliband, leader of the Labour party at the time, for describing the Rock as a tax haven, an unjust term Picard said was used by Spanish media as “a rod with which to beat us.” He insisted that companies in Gibraltar did not “benefit from any form of secrecy whatsoever.”
The Gibraltar government is less than keen to accept the stigma associated with being labelled a tax haven. The country sued the Spanish newspaper ABC in March for defamation after it published a front-page story depicting the Rock as an iceberg of dirty money.
According to Richard Murphy, a contributor for the financial magazine, Forbes, a place can be considered a tax haven if it has a policy of secrecy in which it attracts foreign investors by shielding their financial transactions from other jurisdictions. One other criterion for the label tax haven is the ability to easily move large quantities of money, insists Murphy.