Companies should state in their annual report how much tax they pay. This matter comes within the area of corporate social responsibility, according to State Secretary for Finance Menno Snel. Menno Snel came with his call during a discussion on Dutch television about whether the Netherlands is a tax haven or not. On Monday 1 April 2019 Peter Kavelaars, Professor of Fiscal Economy at Erasmus School of Economics, is asked by Dutch radio station BNR Nieuwsradio what his opinion is on this matter.
According to professor Kavelaars, this plan is not very new: companies are already becoming more open about the way they borrow their money, for example. However, Snel thinks that the same should apply to paying taxes and therefore wants to increase the scope and the volume of the informaiton that companies provide. Currently, the annual reports provide information about the profits and the taxes paid in the Netherlands, but this should also include the taxes payed in other countries. Furthermore, companies now report commercial profits while taxes are levied on fiscal profits, which are lower. If companies would report this as well, shareholders will gain more insight into the fiscal position of the company,
The question however remains how this plan can be enforced. Companies are unlikely to provide this information voluntarily. On the EU-level, a proposal has been filed to oblige companies to report the abovementioned financial data. However, it can still take some years until that proposal actually comes into effect.
- More information
For this radio interview with Peter Kavelaars on BNR Nieuwsradio, click here.
