Koror, Palau – The European Union (EU) removed Palau from its blacklist of non-cooperative jurisdictions for tax purposes, placing it on the grey list instead.
Palau initially appeared on the blacklist in March for lacking tax transparency standards that meet EU requirements. However, after committing to implementing changes, the EU moved the island nation to the grey list.
The grey list includes jurisdictions perceived to have low tax transparency, while the blacklist identifies those with systems facilitating tax avoidance.
Currently, six jurisdictions remain on the EU blacklist, including three U.S. territories: American Samoa, Guam, and the U.S. Virgin Islands. Namibia and Trinidad and Tobago are also blacklisted.
This marks Palau’s second removal from the EU blacklist. It was previously delisted in 2018 before being re-added.
The EU blacklist serves as a tool to identify tax havens with opaque systems that enable tax avoidance and distort fair competition.