Dutch rail company NS again accused of tax evasion

Dutch railway company NS is circumventing the Dutch Tax Authorities using its subsidiary Abellio in Ireland, Trouw reported on Thursday. According to the newspaper, the Ministry of Finance previously instructed NS to stop these tax evasion practices.

Abellio set up an Irish company called Disa Assets Limited late last year, according to documents from the Irish Chamber of Commerce. NS used this company to fund trains for a tender on the German track. According to the newspaper, the sole purpose of this new subsidiary is to pay as little tax as possible.

According to Trouw, Abellio bought trains for the German Diesel Sachsen-Anhalt concession in Ireland and then rented them to the German branch. In this way Abellio can register profits in Ireland, where the corporate tax rate is only 12.5 percent - much lower than the 30 percent corporate tax rate in Germany and the 25 percent rate in the Netherlands. 

NS started using such tax constructions in 1998, when NS Financial Services was set up. This subsidiary purchased trains in Ireland that are still being leased to NS in the Netherlands. The fact that NS is a state owned company, makes the tax evasion constructions it uses very controversial - the Dutch state is missing out on tax money from its own company.