France removes PH from blacklist
MANILA, Philippines - The Philippines was finally removed from the French government's blacklist of 'tax havens,' or those considered uncooperative in fighting tax-related matters with the European Union's EU's No. 2 economy.
The French government included the Philippines in its blacklist in February 2010.
"We were very happy to find out that the Philippines has been removed from the French government's French government's list of non-cooperative jurisdictions for tax policy, otherwise known as a blacklist of tax havens," Finance Secretary Cesar Purisima said in a statement on Sunday, September 1.
“This move is a recognition of the Aquino administration’s commitment and tangible progress in combating tax avoidance and promoting fiscal honesty,” he added.
The removal from the list came as improvements were made on the information sharing on tax-related matters between the Bureau of Internal Revenue and the French government own tax body.
France adopted its own blacklist of countries deemed to be uncooperative in tax matters to fight tax evasion and money laundering, especially those involving French firms doing business in other countries.
This is separate from the blacklists released by Financial Action Task Force (FATF) and Organisation for Economic Cooperation and Development (OECD).
France's list affects the French companies' subsidiaries doing business in countries appearing on the blacklist through unfavorable tax on dividends, interest, and royalties.
According to a Reuters report, being on the 'blacklist' triggers the application of 75% withholding taxes on French source flows to those territories and the strengthening of anti-abuse mechanisms.
France and other countries have been sensitive about tax evasion and have been working to plug holes in their national coffers after the 2008 global financial crisis. France imposes one of the highest tax takes in the developed world.
"We hope that foreign firms, and not just French ones, take this as a signal that the Philippine affords a level, competitive, and transparent playing field for everyone to do business in," Purisima said.
In and out
In 2013 latest review of the countries in the blacklist, France removed the Philippines and added Bermuda and the British Virgin Islands.
This brought the total number of countries on the list at 10, including Guatemala, Botswana, Brunei and the Marshall Islands.
The Philippines has been making steps to improve transparency in transactions. In February 2013, President Benigno Aquino III signed a new law boosting safeguards against money laundering crimes.
The Anti-Money Laundering Law is aimed at preventing terrorists, corrupt officials, drug syndicates and human-traffickers from using the country as a hiding place for their ill-gotten gains
Foreign aid blacklist
In May, France also added the Philippines in another blacklist.
Countries in thist blacklist are banned from using French banks to help distribute development funds. Switzerland was among them.
After Foreign Affairs Secretary Albert del Rosario sought the French government for clarification, France siad last May 28, France said there was a misinformation.
READ: PH not in French foreign aid blacklist - official - Rappler.com