The Cyprus government made a great move last week by pro-actively responding to the Panama papers, which named Cyprus to be amongst the 21 EU, US and other jurisdictions as one of channels used by the wealthy to send their money.
President Nicos Anastasiades called on the relevant authorities to look into the claims and they have responded by initiating immediate action to any residents of Cyprus named in any of the papers, and said they were officially investigating the matter.
These moves are important, as although Cyprus stopped being classed as an offshore tax haven in 2002, this does not stop the international media outlets informally calling Cyprus a tax haven. This was evident during the banking crisis, when German Ministers were reported saying they did want to fund “Russian dirty money” being held in Cypriot banks.
The days of these bad stigmas are long behind Cyprus, after establishing a transparent tax reporting system, and being accepted on the OECD white list, however to convince the global community that Cyprus now has much stricter KYC rules than many other countries, certain bad apples need to be addressed and publicly reprimanded. The Panana Papers scandal is the best way for Cyprus to do this and remove the bad stigma once and for all.