Booking.com CEO very critical of current Dutch business climate

Booking.com CEO Glenn Fogel was highly critical of the business climate affecting companies in the Netherlands. In an interview with the Telegraaf on Friday, he asked, “Why has the Netherlands, which was once very business-friendly, changed so much?” Outgoing Cabinet members cautioned the new coalition government of the PVV, VVD, NSC and BBB to take Fogel’s words very seriously.

“Look at Ireland,” he continued. “When I first started doing business there, there were donkey carts on the roads. Thirty years later, it has become a technology giant. Why? Because they created an environment that attracted companies like Apple, Dell, IBM and Google to develop large campuses. The Netherlands can also do that, but now we are moving in the opposite direction.”

The accommodation booking website is not the first major company to lash out at the recent developments in the Dutch business climate. Microchip machine manufacturer ASML previously warned that the company wants to expand, but their options in the Netherlands may be limited due to political hostility towards highly-skilled workers from abroad, international students, and foreign worker tax breaks.

ASML is the third largest publicly-traded company in Europe based on market capitalization. It has also taken issue with flip-flopping and inconsistent policy regarding taxes and restrictions affecting international businesses. Other major companies, including KPN, ASM, and Boskalis have all raised issues about international talent, international education, and corporate tax policy.

ASML’s plea appear to have been heard by the outgoing Cabinet. It was eventually announced that the national government, together with the Eindhoven region, will invest 2.5 billion euros in improvements to training, education, housing, and infrastructure to support the high-tech sector in the Netherlands.

But Fogel also said that Booking.com feels limited by both Dutch and European regulations, and he was disappointed that the company’s home base and founding country was making matters worse. “We are subject to additional rules and that have negative consequences for our company and the European market as a whole. We are the largest European tech company, perhaps after ASML,” he said.

“In any case, let us ensure that our own home region does not harm us. That is frustrating. It’s a mindset that I just don’t understand.”

The company employs thousands of employees in the Netherlands. The CEO did not want to comment on whether the developing situation is a reason for Booking.com to leave the Netherlands in the long term. “We always have to think about where we can best do something,” he told the Telegraaf.

Outgoing State Secretary Marnix van Rij (Tax Affairs and the Tax Administration) strongly recommended that the Booking.com CEO be taken seriously by politicians in the Netherlands. He pointed to the new Cabinet regarding this, whose plans he does not wish to critique.

He admitted that he saw a few positive aspects of their coalition agreement regarding entrepreneurship and its importance in the business climate. But Van Rij understands the signal sent by Fogel.

He personally spoke to Fogel along with Micky Adriaansens, the outgoing Minister of Economic Affairs. He pointed out the significant contribution that Booking.com has made because of corporate profit tax tax in the Netherlands.

“So it is essential that a company like Booking.com stays in the Netherlands,” Van Rij said. Fogel mentioned Ireland in his interview as a country that is known for extremely favorable tax rates for large companies.

The outgoing state secretary referred to the agreements made internationally regarding minimum profit tax. These agreements were meant to prevent countries from participating in a “race to the bottom” by offering very low tax rates to lure multinationals. Predictability is crucial in tax policy for large companies, Van Rij emphasized.