The Netherlands is ranked third in Oxfam’s annual list of the world’s top 15 tax avoidance centres, the Financieele Dagblad reported on Monday. Bermuda and the Cayman Islands topped the list.

The high score is due largely to the large scope of tax avoidance by multinational companies which operate through the Netherlands, Oxfam said.  Other European countries making the list are Switzerland (4), Ireland (6), Luxembourg (7) and Cyprus (10).

The publication of the Oxfam report ‘Tax Battles, the dangerous global race to the bottom on corporate tax,’ comes as a blow to the Dutch government which is seeking to cut tax avoidance and profit-shifting measures, the paper said.

Oxfam said that large flows of money disproportionate to the size of the economy and corporate presence indicated profit-shifting, which is a form of tax avoidance. In addition sweetheart tax deals are available to multinationals settling in the country, the report said.

It also singled out the tax breaks on innovation. ‘In the Netherlands, it is estimated that one specific tax incentive, the ‘innovation box’, will cost well over €1.2bn in 2016. This figure is equivalent to 7.6% of the Netherlands’ total income from corporation tax,’ the report said.

However Oxfam praised the Netherlands for its cooperation with the OECD in making tax avoidance more difficult.