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Netherlands Invites Input On New Dividend Withholding Taxes

Tuesday, September 29, 2020

On September 25, 2020, the Dutch Ministry of Finance launched a consultation on plans to introduce a withholding tax on dividend payments to low-tax jurisdictions.

The tax is due to apply to dividend payments to countries with a corporate tax rate of under nine percent, as well as to jurisdictions on the European Union's blacklist of non-cooperative territories for tax purposes, even if the country has a tax treaty with the Netherlands.

Already, the Netherlands is to introduce withholding tax on interest and royalty payments to the same jurisdictions from January 2021.

The Government has previously said that it intends to work out the details of the dividend withholding tax before its terms ends in March 2021.

The consultation period concludes on October 23, 2020, and the Government expects to present legislation to parliament in the spring of 2021.