The Netherlands, A Tax Haven

The Netherlands has an international reputation as a tolerant and open country in the heart of Europe. A country known for its tulips, wooden clogs, bicycles, quaint little houses and canals. However: there is a dark side to this nation of traders. The Netherlands is a tax haven. Our country facilitates large corporations to engage in massive tax avoidance, whilst citizens increasingly pay more tax to finance public spending.

Many people are unaware of the fact that Netherlands hosts…
12, 000 …so-called mailbox companies that channel …
4.000.000.000.000 British pounds …every year. That’s whopping 4.000 billion or 4 x 1  million euros!

Why Is Tax Dodging Problem?

  • It’s Unjust:
    Companies contribute less and less to public spending.
  • It’s Harmful To Developing Nations:
    The Netherlands spends +3.7 billion euros on development cooperation every year.
  • It’s Risky:
    The Dutch earns 3 billion every year from its mailbox industry. But this sector is a risky one: mailboxes can remain anonymous and are not adequately supervised, so that the Netherlands in effect facilitates shady businesses, money launderers and terrorists

The revenue loss we can calculate for developing economies resulting from the Dutch tax treaty network alone is around 0.6 billion euros. The actual figures will be much higher. We can conclude that possibly the entire Dutch development budget leaves these countries the same way it enters: through the Dutch tax haven.

What Can We Change?
It is increasingly apparent that the Netherlands has to change its tax system. Fortunately, the solutions are obvious!

  1. Transparency
    The Netherlands has to shed light on who owns what, where the money comes from and where it’s going. Companies  must report how much tax they pay in each country.
  2. Substance Over Form
    The Netherlands should grant tax and investment benefits only to corporations with economic activities in it’s jurisdiction  and not empty shells.
  3. A Fair Tax
    A reform of the Dutch tax system should ensure a fairer distribution of tax burdens and prioritize the public interest

Solutions must be sought through concerted action at EU level between countries and civil society organisations. SOMO collaborates with partner’s in international  and national tax justice networks to work towards a fairer tax system

tax-in-netherland

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