U.S. firms funnel billions through Netherlands to avoid tax
The 50 largest American companies funneled some 1.3 trillion dollars through tax haven. A significant portion of that went through the Netherlands, newspaper AD reports based on a new report from Oxfam America.
Companies including Apple, Microsoft, IBM, Coca-Cola, Google, Pfizer and Walmart use some 1,600 mailbox firms to channel away revenues and profits. A surprising number of these mailbox firms are registered in Amsterdam. Companies like PepsiCo and pharmaceutical Pfizer have more mailbox companies in the Netherlands than in other countries.
The report mainly describes the companies' own behavior, hardly mentioning the names of countries. But an earlier Oxfam report showed that Netherlands is one of the most used tax havens for top American companies. Other popular tax havens for these companies are Luxembourg and Ireland. In 2012 alone, United States multinationals moved up to 700 billion dollars to the Netherlands and other companies.
According to Oxfam America, tax evasion has become the global standard for large companies. "Again we see evidence of massive and systematic abuse of the global tax system", Robbie Silverman, tax adviser for Oxfam said. "The same tricks and procedures large multinational companies in the U.S use to avoid tax, they use in the rest of the world to keep countries from their fair share of tax revenue."
The organization is calling on governments to take firm action against these companies. "If companies do not pay their fair share in taxes, governments are forced to cut back on major facilities or they have to impose higher taxes on the rest of us", Silverman said. "It is time the government stops favoring Big Business and think about the interests of its own citizens."
Oxfam suggests that countries work together to ensure that big companies pay their share of taxes. Lifting confidentiality in tax laws will help with that.