(May 21, 2010) A Belgian Royal Decree of May 6, 2010, with retroactive effect from January 1, 2010, provides a list of jurisdictions deemed tax havens pursuant to article 307, section 1, items 3-6, of the Income Tax Code 1992. The decree was published in the May 12, 2010, issue of the official gazette, MONITEUR BELGE (6 MEI 2010. – Arrêté royal pris en exécution de l'article 307, § 1er, alinéas 3 à 6, du Code des impôts sur les revenus 1992 relatif à la liste des Etats à fiscalité inexistante ou peu élevée, MONITEUR BELGE 26157 (May 12, 2010) available at http://www.ejustice.just.fgov.be/cgi/welcome.pl [in French, Database No. 2010003297].) The list was drawn up by the Council of Ministers on January 27, 2010.
Under article 307, as amended on December 23, 2009, with effect from January 1, 2010, Belgian companies and foreign companies' permanent establishments in Belgium are required to report on their tax returns payments to tax havens in excess of €100,000 (about US$123,300). The amended article defines a tax haven as:
a country which, during the entire taxable period in which the payment was made, was considered by the OECD [Organisation for Economic Co-operation and Development] Global Forum on Transparency and Exchange of Information as not having substantially and effectively implemented the OECD exchange of information standard; or
a country included in a royal decree [for 2010, the May 6, 2010 decree] that lists countries which do not impose a corporate income tax or which have a nominal corporate income tax rate of less than 10%. The relevant list is the one in force on 1 January of the relevant assessment year. (René Offermanns, Reporting Obligations for Payments to Tax Havens Introduced, TNS ONLINE, Jan. 15, 2010, available at http://online2.ibfd.org/data/tns/docs/html/tns_2010-01-15_be_1.html#tns_
The 30 jurisdictions listed as tax havens in the May 6 Royal Decree include: Abu Dhabi [in United Arab Emirates, UAE], Ajman [UAE], Andorra, Anguilla, Bahamas, Bahrain, Bermuda, British Virgin Islands, Cayman Islands, Dubai [UAE], Fujairah [UAE], Guernsey, Jersey, Jethou [one of the Channel Islands, part of Guernsey], Maldives, Isle of Man, Federated States of Micronesia, Moldova, Monaco, Montenegro, Nauru, Palau, Ras Al Khaimah [UAE], St. Bartholomew, Sark [or Sercq, one of the Channel Islands], Sharjah [UAE], Turks and Caicos, Umm al Qaiwain [UAE], Vanuatu, and Wallis and Futuna.
The Decree acknowledges that a certain number of companies active in specific sectors in some of the states or jurisdictions on the list are subject to a tax of at least ten percent under the common law regime; nevertheless, the reporting obligation under article 307 still applies to all payments made, directly or indirectly, to persons established in the states or jurisdictions concerned. (MONITEUR BELGE, supra; see also Constance Johnson, Belgium: New Obligation to Report Payments to Tax Havens, GLOBAL LEGAL MONITOR, Jan. 25, 2010, available at //www.loc.gov/lawweb/servlet/lloc_news?disp3_l205401791_text.)