The Seychelles is the latest addition to the European Union’s “tax-haven blacklist”, a list of countries with policies that enable tax fraud or evasion, tax avoidance, and/or money laundering. The list was first created in 2017 and currently includes 11 other countries, all of whom can be subjected to sanctions by member states or have EU funding withheld.
Responding to news of the Seychelles’ addition to the blacklist, finance and trade secretary Patrick Payet announced that the country is currently engaging with foreign authorities to amend its legal code. A bill to counter money laundering and another designed to address terrorism funding are both being fast-tracked through the legislature.
Why It Matters
Tax collection across Africa is relatively poor, depriving struggling economies of needed revenue for development purposes. Use of secrecy accounts and tax havens like the Seychelles has allowed African autocrats over decades to siphon millions of dollars out of their respective countries, enabling widespread corruption and weakening public services. The ongoing case against Angola’s dos Santos family, who used secrecy accounts to embezzle billions of dollars from state-owned enterprises, revealed the extent of this problem and its continuing damage to Africa.