Audit of tax avoidance started
The Netherlands Court of Audit informed the House of Representatives by letter of 18 February 2014 that it would honour the House's request to audit tax avoidance arrangements and the role played by tax treaties the Netherlands has signed with other countries.
The House had made the request on 3 December 2013. The audit will investigate why the Tax and Customs Administration agrees to exempt businesses from remitting tax in the Netherlands in certain cases. The audit will assess such advance tax rulings against the regulations and treaties. The Court has audited tax ruling practice in the past and investigated the allocation of the profits and losses of multinational groups to particular establishments and branches.
The audit will also look at the Netherlands' position in the network of tax treaties concluded with other countries.
A sample will be taken to determine how the Administration has checked in recent years that branches of multinational groups have actually carried on activities in the Netherlands in order to qualify for tax exemption.
The audit will also consider the amounts involved in the treaties on dividends, interest and royalties that the Netherlands has concluded.
The letter is only in Dutch available.