Obama’s Tax Reforms Anger ‘Haven’ Countries
5 May 09 | FT
The proposed US crackdown on corporate tax avoidance has provoked an angry response from low-tax countries used heavily by the multinationals that are the target of the Obama administration’s reforms.
The US administration, in publishing the plan on Monday, highlighted the Cayman Islands, Bermuda, the Netherlands and Ireland. The US proposals are also likely to be felt in Luxembourg, Switzerland and Singapore where profits reported by US subsidiaries often appear disproportionately high, given the size of those countries.
“We’re not happy,” said Jan Kees de Jager, the Netherlands’ finance secretary. “We have a very transparent policy and we’ll work with the US. I expect there’ll be a clarification [by the US administration] and we’ll not end up on lists like this in future, between Bermuda and Ireland.”
Officials and tax experts pointed to the “very average” corporate tax rates in the Netherlands, which has corporation tax of 25.5 per cent, and noted the country had successfully attracted foreign investors partly because of its location and educational achievements. >>>