Blacklist of countries for doing business

In the fight against tax evasion, the Netherlands has compiled its own list of countries with low tax rates. This new Dutch list includes 21 countries. The list of countries was published in the Government Gazette (Staatscourant). This list will be used as a guide when dealing with companies that are registered in suspicious countries.

The list includes five countries that are currently on the European Union blacklist:

• American Samoa
• US Virgin Islands
• Guam
• Samoa
• Trinidad and Tobago

And also sixteen more countries (a separate list of the Netherlands) with low taxation levels. These countries include:

• Anguilla
• Bahamas
• Bahrain
• Belize
• Бермудские острова
• The British Virgin Islands
• Guernsey
• Isle Of Man
• Jersey
• Каймановы острова
• Kuwait
• Qatar
• Saudi Arabia
• Turks and Caicos Islands
• Vanuatu
• United Arab Emirates
• All these are states without income tax or with a tax rate of less than 9%.

Thus, there are more countries on the Dutch blacklist than on the European one. The Netherlands is here, so to speak, one step ahead, because the European list (yet) does not include all those countries that the Netherlands considers to be low-tax countries.

Secretary Snell said: "By putting together our own tougher blacklist, we want to show once again that we are serious about tackling tax evasion, and this is just one of the measures we are taking."

At the same time, the Netherlands simply will not do business with companies that are located in countries from the first list (pan-European). The countries from the second (personal) list will be subject to some "sanctions", namely:

1. Amended Control Measures for Foreign Companies (CFC-maatregel). Effective from January 1, 2019. Thus, the government wants to prevent tax evasion by moving mobile assets to a country with low taxes.
2. The introduction of income tax and royalties (which will come into force on January 1, 2021). This means that companies registered in the countries included in the Dutch list will, from 2021, pay 20,5% tax on income and royalties they receive from the Netherlands.
3. Tax ruling will be abolished for transactions with companies located in the countries indicated in the list.

The Dutch list will be approved every year. The European list will be approved in the first quarter of 2019. If, in the future, countries that are not on the list of the Netherlands are included in this list, the measures to combat tax evasion will be extended to these countries as well.

Thus, those with companies on the Dutch list have two years to rethink their work schemes and find simpler or more tax-friendly options.

You can always contact Nalog.nl for advice on this topic. Our experts will be happy to help you.