Netherlands a tax haven for Central American corporations; “Sometimes illegal”

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No image availableNL Times

Central American companies annually funnel millions of dollars through the Netherlands in an effort to avoid tax. The Netherlands route is particularly popular with wealthy Mexicans and Ecuadorians who use complex tax structures to get their money out of the country. These structures are often technically legal, but "sometimes illegal", according to Trouw and the Financieele Dagblad based on the Panama Papers.

Two of the largest companies in Ecuador use a Dutch company to evade million s in taxes. Dutch companies participate in a number of the probably illegal tax structures, according to the newspapers.

For example, the Chinese state-owned China International Water & Electric Corp (CWE), which is building a dam in Ecuador, funnel millions out of Ecuador every year through Dutch tax consultancy Infintax. They use fake contracts and invoices to give the illegal money flow the semblance of legitimacy.

Last year Infitax also worked with an Ecuadorian car dealer for months on a structure to inflate the prices of spare parts for police cars, using fake contracts. In this way the company could charge much higher prices to the Ecuadorian National Police. When asked, Infintax told Trouw that this structure was eventually never used. The firm did not give a reason.


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