The Netherlands remains an attractive place for tax evasion

The Netherlands is still an attractive place for companies and criminals to avoid paying taxes and hiding cash through fictitious mailboxes, despite the government's efforts to address the problem. A spokesman reported the news server DutchNews.nl, referring to Monday's statement of a special government commission. The Commission noted that the Netherlands remained a major player in the diversion of financial flows, with the current situation damaging the Dutch reputation, with little economic benefit, and therefore called on the government to take further steps to remedy the situation. A special commission noted that these fictitious companies created only 3,000 to 4,000 jobs and secured less than 1% of the country's tax revenue. The main winners of this situation were multinational companies and their tax advisors. The Commission therefore recommended that the government take steps to increase tax transparency, increase supervision and request more detailed financial statements from the box companies. In particular, changes to the end-user benefit register should help to clarify who is hiding behind fictitious companies. In response to these reports, Tax Minister Hans Vijlbrief said the government would continue to play a proactive role in improving the country's international tax regime, but it would be up to the future government to decide whether or not to implement the special commission's recommendations. The Tax Justice Network rankings released earlier this year indicated that the Netherlands remains an important location for tax evasion, with only the British Virgin Islands, Cayman Islands and Bermuda playing a greater role in helping multinational corporations pay lower taxes. The Netherlands came to this position due to regulatory gaps that allowed interest, royalties and dividends to be transferred elsewhere, and the way in which multinational companies can offset losses recognized in another jurisdiction. However, the Treasury Department says the outgoing government cabinet has made significant progress in eliminating tax evasion by adopting new rules on interest and royalties and other changes that will come into force in 2024.