In April 2020 a committee explored potential corporate income tax measures ensuring that multinationals with a presence in the Netherlands are sufficiently taxed while not losing sight of the Dutch investment climate (2020 Report, see here for more information). In November 2021 a second committee published a report on potential tax and non-tax measures to prevent the abusive use of conduit companies (2021 Report, see here for more information).

The Dutch (caretaker) government has responded to the recommendations of both reports and certain measures actually have been implemented in Dutch tax law. Meanwhile, the government has changed its (initial) view on several of the recommendations as, for instance, international developments no longer required or will require the implementation of certain unilateral measures.

Status of the 2020 Report recommendations


The 2020 Report contained seven unilateral tax measures on which the advisory committee had consensus. These recommendations including the initial response of the Dutch government and their current status are outlined below.

2020 Report  

 
  • Initial response government: In favour to adopt
  • Current status: Implemented (see also here)
  • Initial response government: More research required
  • Current status: Rejected due to complexity
  • Initial response government: More research required
  • Current status: Rejected due to complexity
  • Initial response government: More research required
  • Current status: Rejected due to complexity
  • Initial response government: Initially not in favour to adopt, but included in the coalition agreement (see also here)
  • Current status: No longer seen as required due to envisaged implementation of Pillar II (see also here)
  • Initial response government: In favour to adopt
  • Current status: Implemented (see also here)
  • Initial response government: Not specifically in favour as a unilateral measure awaiting international developments
  • Current status: Implemented (see also here)

The advisory committee listed also additional measures in their 2020 Report, on which the committee could not agree unanimously. One of the suggestions was to tighten the earnings stripping rules and this has been implemented in Dutch legislation (see also here).

Status of the 2021 Report recommendations


The 2021 Report consisted of both tax measures and non-tax measures to prevent the abusive use of conduit companies. A summary of the tax-related recommendations and their current status is set-out below. We do note that the Dutch caretaker government at that time responded that implementation of these recommendations should be taken by the new government.

2021 Report

  • Current status: Remains to be seen in light of the proposed EU Unshell Directive
  • Current status: No unilateral steps, awaiting further EU developments (see also here)
  • Current status: Expected to be covered by the proposed EU Unshell Directive (see also here)
  • Current status: Implemented in Dutch tax treaty policy
  • Current status: Confirmed in formal communications
  • Current status: Expected to be covered by the proposed EU Unshell Directive (see also here)

Following the overviews of both reports it is interesting to see that on the one hand the Dutch government is willing to adopt unilateral measures, while on the other hand the international developments most of the time prevail in the end.

Let’s see whether Dutch Budget Day on 20th September will shed further light on these subjects. In any case, we will keep you posted on further developments in this regard.