multinationals

Multinational companies which conduct business in the Netherlands will soon be forced to pay taxes on their profits, instead of creatively using an accounting loophole to avoid tax liabilities in the country. The ruling Dutch cabinet, led by third-term Prime Minister Mark Rutte, has reportedly agreed to back an initiative from the left wing opposition parties, according to broadcaster NOS and newspaper AD, both citing unnamed sources.

The left-wing opposition parties GroenLinks, SP and PvdA want multinationals like Shell to pay profit tax in the Netherlands. They are submitting a bill to achieve this to the Tweede Kamer, the lower house of Dutch parliament, later this week, NOS reports.

The Dutch Tax Authority will not share details on the majority of its tax rulings with multinational companies with other European Union countries, despite an obligation to share all agreements with 'cross-border effects' over the past five years with Europe, Trouw reports. 

According to the Tax Authority, it makes an estimated 2 thousand deals per year with large and small companies that also have consequences for foreign countries. That amounts to around 10 thousand tax rulings that the Netherlands is obliged to share with the EU.

The Netherlands is the number one choice in the world for multinationals to funnel money into tax havens, according to a study done by researchers at the University of Amsterdam. The researchers concluded that 23 percent of capital flows through the Netherlands go towards tax havens, ANP reports.

Britain comes in second place with 14 percent, followed by Switzerland with 6 percent, Singapore with 2 percent and Ireland with 1 percent. Together these five countries account for nearly half of the money globally funneled towards tax havens. 

GroenLinks will focus on an ambitious climate policy, stopping tax evasion by large multinationals and getting rid of the existing inequality in the Netherlands, party leader Jesse Klaver promised in his party's election campaign presented in a packed Melkweg in Amsterdam on Tuesday night, NRC reports.

The judgement made by the European Commission over the Starbucks tax agreement could have far reaching consequence across the country, with nearly 15,000 such deals having already been made. Tax authorities have seen the period between 1991 and 2014 as the main problem era, with billions at stake.