The Netherlands supports Country-by-Country reporting

A guest blog by Koos de Bruijn, member of the global Board of TJN.

As from this week the Dutch government can be added to the list of supporters of Country-by-Country reporting. Yesterday the Tweede Kamer (the Dutch parliament) adopted a motion urging the government to strive for Country-by-Country reporting to become the international norm.

Motion TK 25087 nr. 9 of Mr. Bashir (SP) and Mr. Braakhuis (GL):

noting that the government in the new tax treaty policypaper explicitly states that the Netherlands wants to contribute to international fiscal transparency;
noting that multinational companies so far do not have to indicate how much tax they pay in any country;
noting that this information is available for businesses;
noting that the Netherlands is actively involved in multilateral initiatives in the field of rules for country-by-country reporting;
Urges the government to make efforts to country-by-country reporting becoming an international standard.

The motion of the Socialist Party and the Greens, which was supported by a big majority including governing party CDA (Christian Democrats) and the ‘government-tolerating’ PVV of Mr. Wilders.

Earlier this week Mr. Weekers , the State Secretary for Fiscal Affairs, already took a step in the right direction with regard to the debate on CbC-reporting in the European context. He indicated he was looking forward to the European proposals with a ‘positive attitude’. It was not exactly clear what that meant, though Weekers made clear it didn’t mean he wants to take a position before there is a proposal.

Now, the parliament requires him to go a step further. The Netherlands from now on will not only be looking forward to a good proposal, but will (or at least is required to) actively participate in the debate to make sure the outcome is country-by-country reporting. And not only in the European context the Netherlands, but also in the international context.

What would this mean for the subgroup on Country-by-Country reporting of the OECD Informal Taskforce on Tax and Development currently co-chaired by the Netherlands?

However, it isn’t all hallelujah that comes from the Netherlands these days. The debate in which this CbC-break through was achieved, was about the new Tax Treaty Policy Paper. The paper explains the Netherlands will work on expanding their tax treaty network to developing countries: not good news since this will connect vulnerable developing countries to the network of the Treaty Haven the Netherlands are. The SAB Miller case provides a warning of where this might lead: Ghana has had a tax treaty with the Netherlands since 2009. In 2011 the government plans to start negotiations with countries like India, Indonesia, Ethiopia and Angola.

Even a motion asking the government to test the possible consequences for a developing country, before starting negotiating a tax treaty with them, didn’t make it. Dutch foreign-policy always involves a mixture of a businessman and a reverend (koopman en dominee). These days the businessman seems to prevail.

To be continued.