Internet consultation on international ruling practice | Deloitte Nederland

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Internet consultation on international ruling practice

The State Secretary for Finance has informed the House of Representatives on the details of tax agreements between the Tax Administration and multinationals. An internet consultation on the revision of the ruling practice has also been started.

17 September 2018

Background

In early 2018, the State Secretary for Finance informed the House of Representatives on the results of an internal investigation into the international ruling practice within the Tax Administration (see earlier reports here). On the back of this, he answered parliamentary questions recently. He has also started an internet consultation on the revision of the existing ruling practice.

Parliamentary questions

The information provided by the State Secretary raised parliamentary questions. In answering these questions, the State Secretary for Finance explained that various types of tax agreements should be distinguished. While all tax agreements offer taxpayers certainty in advance, tax agreements qualifying as Advance Pricing Agreement (APA) or Advance Tax Ruling (ATR) are governed by specific legislation (the APA/ATR Decree). A specialized team has been assigned to issue these agreements, and the agreements are recorded in a central location. Other tax agreements can be issued by local inspectors and are not recorded in a central location. APAs and ATRs are also always entered into for a certain period, after which a new ruling concluded.

Revision of ruling practice

As the quality and sustainability of the Dutch ruling practice needs to be made future-proof, the State Secretary wants to revise both the issuing process for rulings and the contents of rulings. One of the issues he deems necessary is more central coordination of all rulings with an international character. The past period has been used to put more meat on the bones of this plan, by cooperating with an external advisory group to list various options. An internet consultation has now been used to present the alternatives to anyone who wishes to contribute to the discussion. The reply period expires on 20 September 2018.

Tighter substance requirements are among the alternatives proposed. Another alternative is to no longer issue rulings to certain companies if they are established in countries regarded as tax havens. A possible cap on ruling terms and possibilities to increase the transparency have been examined, too. The final revision plans should be sent to the House of Representatives in the autumn. The target date for implementation of the new ruling practice is 1 January 2019.


Source: Letter State Secretary for Finance 30 August 2018, 2018Z14484; and Working Paper on the Revision of the Ruling Practice

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