Dutch Govt. to renegotiate tax treaties with 23 developing countries in response to criticisms of facilitating corporate tax avoidance

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25 September 2013

Many years of research by SOMO pays off [Netherlands]

Author: SOMO (Centre for Research on Multinational Corporations)

After years of social pressure, the Dutch government recently admitted...that its tax policy, including tax treaty policy, is harmful to many people, countries and companies worldwide. SOMO has played an important role in recent years by publishing numerous reports about tax avoidance...Studies by SOMO have shown that large multinationals establish so-called “mailbox” companies in the Netherlands and use them to channel payments to tax havens...[T]he money that flows through these companies results in a direct loss of tax revenue for other countries, especially developing countries, which lose billions of Euros...The Ministries of Finance and Development Cooperation have announced they will join forces to reduce tax avoidance in the Netherlands...Whether government proposals for a fairer tax system will succeed will depend on the way the measures are implemented and enforced. Yet SOMO is excited about the current impact of its investigations.

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12 September 2013

Dutch tax avoidance crackdown sparks debate

Author: Matt Steinglass & Jamie Smyth, Financial Times (UK)

A Dutch initiative to crack down on tax avoidance by multinational corporations is being fiercely resisted by the business community, with the American Chamber of Commerce in the Netherlands warning it could drive US corporations to move their European headquarters out of the country...This month the Netherlands responded to rising criticism with a plan to tighten conditions for so-called letterbox companies, shell companies that multinationals establish largely for tax purposes. The proposal includes an offer to renegotiate Dutch tax treaties with 23 developing countries, which tax justice advocates say lose out on huge amounts of revenue through tax avoidance...Wouter Paardekooper, a partner at Baker & McKenzie who heads the tax committee of American group, said the new plan introduces uncertainty that will hurt the Dutch investment climate. “There are companies with major regional headquarters here with investments in Africa,” Mr Paardekooper said. “[Their] consideration as to whether we should go ahead in the Netherlands, or should make future investments somewhere else, is not well served by this [offer].”

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6 September 2013

Netherlands to review tax treaties with least developed countries

Author: Matt Steinglass, Financial Times (UK)

A proposal by the Netherlands to renegotiate its tax treaties with 23 least-developed countries marks a turning point for a country that has until now deflected accusations that it is a key player in tax avoidance by multinational corporations...The Dutch move stems from a government-commissioned report over the summer which, for the first time, agreed with tax-justice groups that developing countries miss out on substantial tax revenues because of their treaties with the Netherlands...The Dutch propose to insert new anti-fraud provisions in the tax treaties...In a second move, the Dutch will pass on information to tax inspectors in least-developed countries when multinationals request a so-called “tax ruling” in the Netherlands...[T]he Dutch will crack down on letterbox companies by forcing even companies that have not asked for tax rulings to meet the country’s “substance demands”...Advocacy groups in the Netherlands have cautiously applauded the Dutch move, but said the new measures were modest.

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24 January 2013

Tax avoidance - an introduction

Author: compiled by Business & Human Rights Resource Centre

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