MPs are supposed to supervise the cabinet but in the case of tax deals with Starbucks and the like they have no way of knowing which deals have been struck. Unconstitutional, cry MPs Jesse Klaver (GroenLinks), Arnold Merkies (SP), Pieter Omtzigt (CDA) and Carola Schouten (CU.
MPs have no way of making sure if deals between the Dutch tax office and multinationals such as Google and Starbucks are fair and within the confines of the law. Finance minister Jeroen Dijsselbloem and junior minister Erik Wiebes are consistently refusing to inform them as to the particulars of these deals. By withholding this information from MPs they are effectively interfering with the lower chamber’s supervisory function.
The air of mystery surrounding these deals does not inspire confidence in what it is the tax office is offering the companies in exchange for their presence in the Netherlands. Parliamentary supervision is vital and that is why we call on both politicians to respect the lower chamber’s constitutional right to be informed.
Tax evasion by multinationals does not sit well with the citizens of this country, and rightly so. Every day brings news of yet another construction which allows companies to reduce their tax bill. Disney, for example, only paid a 0.25% tax on its profits between 2009 – 2013.
Amazon only paid 1% in tax on its European turnover over the last 10 years. And between 1998 and 2012 Starbucks in Britain paid €8.6m in tax while its turnover in that period was over 3,4000 times (!) as much. Compare that to the level of tax faced by small companies and workers. The cafeteria around the corner and the bookshop are paying a much higher percentage than Starbucks and Amazon. That is unfair and not how it is supposed to be.
These companies happened to be in Luxemburg but they might as well have been in the Netherlands. The Netherlands also offers so-called tax rulings to companies which stipulate the way tax is levied. There’s nothing wrong with this in principle. But increasingly the signs are that this ruling practice is getting out of hand. The European Committee found that the Starbucks tax bill is a whopping 90% lower than is should be thanks to a deal with the Dutch tax office, prompting an investigation into unfair state support for Starbucks.
That is a serious allegation and all the more reason why MPs should have a proper look at exactly which breaks the tax office is offering to companies like Starbucks. The information can be treated confidentially if need be. But the cabinet is steadfast in its refusal to give out any information and is therefore hindering the lower chamber in the execution of its supervisory task.
Dijsselbloem and Wiebes are hiding behind the tax law. It contains a confidentiality clause which prohibits the further divulgence of companies’ tax-related data beyond what is needed to execute the tax law. That is much too convenient. The law also offers the possibility to wave confidentially, for instance if it serves the greater good of society. We feel that, in view of the social unrest caused by tax avoidance, the greater good of society would most definitely be served.
A minister or a junior minister who persists in his refusal to hand over certain data will have to do so citing the interest of the state as described in article 68 of the constitution which governs the right to information. But in this instance we see no danger to the interest of the state. The recent announcement by the minister that he intends to share the Dutch ruling practices with the tax authorities in other countries makes this abundantly clear
Following an investigation in Luxemburg, the rulings turned out to differ significantly from the government’s version. The European Committee is now investigating Dutch ruling practices. But it’s high time the Dutch parliament are allowed to execute their supervisory task as well.
We call on minister Dijsselbloem and junior minister Wiebes to stop resisting a transparent tax system. And we call on our Labour and VVD colleagues to take the supervisory task of MPs seriously and this time around support our motion to confidentially inform parliament about tax rulings.
Jesse Klaver (GroenLinks), Arnold Merkies (SP), Pieter Omtzigt (CDA) and Carola Schouten (CU) are MPs.
This opinion piece appeared earlier in the Volkskrant.
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