DutchNews, February 19, 2016
The tax avoidance tactics used by
multinationals are again in the spotlight following claims by Dutch business
magazine Quote that Google pushed €11bn in royalty payments through the Netherlands.
Royalties are not subject to tax in the Dutch corporate taxation system.
Quote
bases its claim on analysis of Google’s 2014 accounts which show a letter box
firm in Amsterdam with no employees had income of €10.7bn and paid just €2.7m
in tax. That, Quote said, is one thousand times below what it should have been
without the tax break.
The income comes from the entire international Google
operation, which transfers royalties to Google Netherlands Holding, based in
Amsterdam’s Zuidas business district.
Ireland
From there, almost all the money
transferred to an Irish Google company, which is actually based in Bermuda.
Dutch corporation tax was paid on the €10.7m which remained in the Netherlands.
Labour MP Ed Groot described the claim as ‘lunacy’. Small firms and private
individuals are picking up the cost of building roads, of education and
healthcare while international company profits head off to a tiny group of
shareholders, he said.
Tax minister Erik Wiebes refused to comment on Quote’s
allegations because of confidentiality agreements. MPs are also pressuring him
to come clean on Ikea’s tax arrangements in the Netherlands following claims it
too is avoiding taxes via the Netherlands.
Starbucks
The Dutch finance ministry
is currently appealing against a European Commission ruling which said it had
given illegal state support to US coffee chain Starbucks.
In October, the
commission ordered the ministry to reclaim up to €30m in back taxes from
Starbucks, which it said resulted from the illegal tax deal.
The Dutch tax
office has made 14,619 advance tax agreements with international companies
since 1991 and refused a further 1,590, the Financieele Dagblad said in June.
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