The cabinet has sent the bill for a minimum profit tax to the House of Representatives. The proposal is an elaboration of international agreements with nearly 140 countries, and the Netherlands is the first EU country in which the bill has been submitted to parliament.
The bill stipulates that companies with a turnover of at least 750 million euros always pay at least 15 percent profit tax. The law must soon ensure that the Netherlands can levy tax if a subsidiary of a Dutch BV is located in a tax haven.
This should prevent countries from starting a ‘race to the bottom’ with ever lower tax rates to lure companies. Moreover, tax avoidance through other countries becomes more difficult. In October 2021, 136 countries reached an important agreement led by the Organization for Economic Co-operation and Development. According to the latest calculations by the OECD, the measures should generate more than 200 billion euros in tax revenue for governments.
In the Netherlands, companies with a profit of up to 200,000 euros have been paying 19 percent profit tax since this year. Companies with a higher amount under the line pay almost 26 percent.
Responsible State Secretary Marnix van Rij is ‘happy with this new step that will lead to a global approach against tax avoidance’. That is, after all, ‘one of my spearheads’.
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