In the end of December 2018, the Dutch Government published a list of 21 low-tax jurisdictions which have corporate tax rate of less than 9 per cent. The Government will implement new anti-tax avoidance measures for the companies having business in these territories.
Among the countries on the blacklist there are the British Virgin Islands, Belize, the Cayman Islands, Anguilla, the Bahamas, and many others; it includes also five jurisdictions which are already on the European Union’s blacklist. All these territories will fall within the scope of new Dutch controlled foreign companies (CFC) rules, effective from January 1, 2019.
The new rules which are under the EU’s Anti-Tax Avoidance Directive are intended to ensure that the EU country in which parent company is domiciled will be required to tax certain profits that are parked in a low or no tax country. The company will get tax credit for any taxes paid abroad.
Also, the Dutch tax authority will no longer issue tax rulings to taxpayers regarding tax structures with companies domiciled in the listed above low-tax jurisdictions. The list is expected to be reviewed annually.