Dutch Parliament on international tax schemes
After the discussions in the UK parliament about Facebook and Starbucks, in which, the Dutch Parliament has questioned the role of the Netherlands in international tax structures.
The Dutch State Secretary of Finance has answered these questions in a letter. First he stresses that many international tax planning tools used by multinational companies are based on legitimate principles that cannot be defined as tax abuse in itself. Furthermore, he has indicated that he advocates recent initiatives such as from the EC and the OECD (European Commission: ‘An Action Plan to strengthen the fight against tax fraud and tax evasion’ / OECD project: ‘Base Erosion and Profit Shifting’). However, he also strongly indicates that tax avoidance is an international problem that requires an international approach. The Netherlands will not take any solo actions in this respect. Furthermore, the open nature of the Dutch economy should always be taken into account. The Dutch tax system should always allow for Dutch enterprises to expand their business internationally.
It is clear that the State Secretary of Finance is not easily going to give up on those elements that make the Dutch tax system attractive for foreign investors and intermediate holding or royalty companies.