The Rolling Stones and U2 do not have many of their business interests located on Amsterdam’s Herengracht to avoid taxes, the director of the two companies which manage their rights told a Dutch parliamentary hearing on Monday.
Jan Favié is director of Promogroup B.V. en U2 Limited, the companies which manage the two global rock bands’ rights. He had been called to appear at the inquiry which was set up following the Panama Papers leaks and aims to establish whether or not the Netherlands is used as a tax haven and to find out more about how trust offices, which represent thousands of shell companies, work.
Favié told the six MPs on the committee that the bands were based in the Netherlands because of the ‘specific experience and expertise’ in the Dutch market. He also dismissed claims that he headed up a letterbox company.
‘There is no good definition of a letterbox firm,’ he said. ‘They are target-driven companies which are managed by a trust office. That is not what we are’. Nor did he accept the concept of tax evasion, pointing out that both Promogroup and U2 Limited pay tax on their profits in the Netherlands.
Nevertheless, MPS continued to press him, under oath on the role of both companies for almost two hours. In particular, they questioned the ‘opportune’ decision by U2 to move their operations from Ireland to the Netherlands just at the time when Irish tax system changed.
They also questioned the fact that just six people work at the Promogroup office, despite Favié’s assertion that the company is involved in managing projects and producing albums, DVDs and documentaries as well as managing the Stones tongue and lips logo.
‘You are playing dumb when you are not dumb,’ inquiry member Chris van Dam, from the Christian Democrats, was quoted as saying by the Financieele Dagblad. ‘You have not convinced me. What you are saying is not credible.’
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