• Andrea Feliziani

Errors found in Dutch Tax rulings

A recent investigation into 4.4462 tax rulings revealed the occurrence of procedural errors in 78 cases, pushing Dutch tax authorities to consider reducing the number in future.

The investigation was launched after the Dutch newspaper Trouw showed how the procedural rules had not been applied in a tax ruling concerning Procter and Gamble.

6 of the procedural errors were spotted in the 3,101 rulings issued by the department specialised in advanced pricing agreements. The remaining 72 errors were made in cross-border rulings.

Political authorities agree that the results of the investigation show the need to change the organization of the rulings, in order to restore full legal certainty of what is considered a pillar of Dutch tax system.

The State Secretary for Finance Menno Snel suggested to limit such rulings to companies that fulfill the due requirement of sufficient economic substance in the Netherlands.

Snel also stated that the Dutch Government intended to consult on changes to tax ruling practices until the end of 2018, in order to be ready for a new system that will enter into force by 1 January 2019.

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