Documents reveal early concerns over tax structure used by former Finance Secretary
Documents, released following requests from NOS and Nieuwsuur, reveal that senior civil servants raised concerns about the tax structure used by former Dutch Secretary of State for Finance, Folkert Idsinga, long before his resignation. Idsinga stepped down in November 2024 amid scrutiny over his financial interests, including an investment in the algae company Phycom in Veenendaal. The structure of this investment was so favorable that Idsinga may have received more money back from the tax authorities than he initially invested.
The documents show that officials at the Ministry of Finance had questioned the tax scheme for over a decade, but despite repeated suggestions to adjust the rules, no changes were made. According to an email from a civil servant at the Dutch Enterprise Agency (RVO), which administers subsidy programs, the tax office had been informed about concerns. "We have repeatedly inquired with the tax authorities whether these tax structures are permissible," the email states. "The tax authorities have indicated that this is allowed under the law."
Idsinga's investment in algae, which are used as substitutes for animal proteins, qualified for tax incentive schemes designed to promote environmentally friendly investments. However, when the investment came to light last fall, tax experts described it as an "aggressive" strategy, where wealthy individuals used environmental subsidies for tax avoidance.
In November, Idsinga firmly denied that his resignation was linked to questions about his investment in Phycom. He rejected the characterization of his investment as tax avoidance, calling it "nonsense." Meanwhile, the RVO official had called for the specific algae subsidy to be revised to avoid "various tax schemes we do not want in the press." As a result, the government revised the scheme in late 2024.
However, the problem is not confined to algae investments alone. An email from the Ministry of Finance indicated that similar tax avoidance structures exist for other investment codes. "The algae investments are currently in the media spotlight, but we know from practice that there are multiple codes for which such investment structures are set up," the email stated. The reason, the email adds, is that the benefits of these schemes are still highly lucrative.
In a letter to Parliament, Minister van Oostenbruggen suggested that the tax rules could be easily adjusted to prevent misuse. "This would make certain schemes no longer applicable or less attractive in some situations," he wrote. However, he did not announce any specific plans to address the issue. A previous proposal by the Green Left and the Labour Party (GL-PvdA) to tackle tax avoidance schemes was rejected by the coalition government.
