The Netherlands is still high on tax avoidance list

Some 17% of corporate global and 5% of private wealth-related tax avoidance is channeled via the Netherlands, according to new research from the Tax Justice Network

The figures are based on 2018 figures from the OECD and show other countries missed out on a total of $51 billion in tax income because of tax avoidance through the Netherlands. In 2016, the figure was $19.4 billion, the NGO said. 

In total global tax evasion amounted to $472 billion, of which $171 billion was down to rich individuals and the rest to global companies. 

The researchers conclude that multinationals move some 40% of their profits to countries that offer tax advantages, and that the UK is the most popular destination. 

The money channeled through the Netherlands came largely from Belgium, Germany, Luxembourg and the US.

The Dutch government has been working to amend or scrap some tax legislation and, for example, has now introduced a tax on royalties.  Other changes, including a withholding tax on multinationals, will be introduced next year.

TJN said most global tax abuse is made possible by abusive regulation in rich countries, not “palm-fringed islands”. 

“Countries will vote at the UN later this year on whether to move rule-making on global tax from the OECD to the UN,” the organisation said. “Democratically deciding UN tax rules can make it possible to finally eliminate global tax abuse and win back the $4.7 trillion countries will otherwise lose to tax havens over the next 10 years.”

Some 10,000 shell, or letter-box, companies are based in the Netherlands and are primarily used to shift corporate earnings and obscure ownership.

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