nov 20 and 21 1

Study visit Inland Revenue Service

of Chili

Amsterdam

20 & 21 november 2007

Hans Rouw ja.rouw@belastingdienst.nl Tom Quellet.quelle@belastingdiemst.nl

Dutch Tax and Customs AdministrationBelastingdienst Amsterdam

BIENVENUDOS

nov 20 and 21 2

Dutch Tax and Customs Administration

=

Belastingdienst

nov 20 and 21 3

Welcome in Amsterdam

20 & 21 november 2007

nov 20 and 21 4

More than 200 year experience with taxation

• Advantages but also disadvantages

• Constantly changing environment: so a constantly changing organisation

• Laws that are political instruments

• Entering the “E-world”

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WWW.Belastingdienst.nl

• All kind of public information on the web site.

• In the future everyone a “personal status site”

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The Netherlands

Economic activities

Clogs, Tulips and Windmills

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Europe - European Union.

• Old members

New mebers• Potential members• Waiting-room

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The Netherlands • Over 16 million inhabitants• 1.000.000 enterprises (MKB)• 10.000 large organisations (MGO)• 1.000 very large organisations

(ZGO)• 25 global players (ZGO)• import/export country• (small) financial center in Europe• large continental shelf• many taxes and tax-treaties

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Summary of Taxes in The Netherlands

• Taxes on income, profits and net wealth

• Taxes and duties on goods and services

• Social security contributions

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Dutch TaxationIncome, profit, net wealth• Income tax• Corporate tax• Dividend tax• Inheritance tax• Salaries tax• Tax on games and

chance

Goods and services

• VAT• Import duty• Insurance tax• Motor vihicle tax• Environmental tax• Regulatory energy tax

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Difference between commercial annual report and fiscal report.

• Commercial annual report on basis of international financial reporting standards (IFRS) or Dutch accountanting/auditing standards.

• Annual fiscal report on basis of fiscal legislation and fiscal rules.

• Requirements SEC (US-GAAP) • AFM

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Accounting, Auditing and Tax-advisor

• Every enterprise in the Netherlands has its own tax-advisor.

• Bookkeeping and accounting mostly “in house” or with the support of specialist.

• External auditing only in large companies.

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The government in The Hague

nov 20 and 21 14

Dutch National Bank

nov 20 and 21 15

Ministery of Finance

Treasury Directorate G eneralof Budget

Directorate G eneralof Tax and Custom Policy

Directorate G eneralof Tax and Customs

Adm inistration

Secretary General

Minister of FinanceState secretary for tax & customs

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The Top

Minister of finance State-secretary for tax and customs

mr. W. Bos mr. K-J. de Jager

mrs. Thunnissen Director general Belastingdienst

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The Dutch Treat

Tax and Customs Administration of The Netherlands

Belastingdienst / Amsterdam

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Integrated Tax and Customs organisation

4 regional customs-offices

13 regional tax-offices

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Dutch Tax and Customs Org.

1 3 R e g ion a l Ta x o ff ices 4 R e g io n a l C u s to m s o ff icesC e n tra l a dm in istra tion

T a x a llow a n ces

A u tom atio n cen te rR & D ce n ter

E d u ca tion cen te rF isca l in fo rm atio n an d in ve stig a tio n serv ice

D ire c to ra te G e n e ra lM a na ge m e n tte am

S ta ff tea m s

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Belastingdienst / Regions Tax organisation of The Netherlands

1. Noord 2. Oost 3. Randmeren 4. Rivierenland 5. Utrecht-Gooi 6. Amsterdam 7. Holland Noord 8. Haaglanden 9. Holland Midden10. Rijnmond11. Zuidwest12. Oost-Brabant13. Limburg

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Two main offices for very large organisations

AmsterdamRotterdam

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1. WEST1. WEST2. ROTTERDAM2. ROTTERDAM3. North3. North4. South4. South

Belastingdienst/Regions of customs

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General policy statements Dutch Tax and Customs Administration

• promotion of compliance

• communication with and service to taxpayers

• from D-service to E-service

• uphold (tax-)laws

• unity in performance

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Compliance policy

Investigation & monitoring

(intelligence)

Co-ordinationMaintainingCompliance

Content of legislation

Agreements

Communication

Actions an themes

Specific investigations

Fraud investigations

Administrative supervision

Interactive

Wanted effect: compliance

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Pyramid of supervision

‘Opsporing’ High risk

intensive supervision

mass supervision

information

service

CRM

Low risk

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Difference in treatment between individuals and companies

• Treatment of individuals is highly automated (internet)

• Treatment of small companies will be automated in the next 5 years.

• Complicated fiscal legislation for companies

• Administrative obligations for companies• Roll of tax advisor and tax auditor

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Dutch Global Players• Royal Dutch Shell

• Ahold

• Akzo Nobel

• KPN Telecom

• Unilever

• ING

• ABNAMRO

• Philips

• Heineken

• Air France KLM

• Corus

• Dutch State Mines

• Sara Lee

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Cash cow

>50% of the total Dutch tax revenue is generated by very large taxpayers

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Special treatment

• Very large companies• Bank companies• Insurance companies• Stockexchange service• Energy companies• Oil & gas companies• Football organisations• Advance rulings

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Tax Rulings

History• 1989 local ruling

taxinspector

• 1990 concentration rulingtaxinspectors in Rotterdam

• 1997 EU Harmfull taxcompetitionreport

• 2001 APA/ ATR practice

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APA/ATR practiceAPA = advance pricing agreement

ATR= advance tax ruling

• Concentration in Rotterdam

• Important role for knowledge group (CGVP)

• Codification of the “arm’s length priciple”

• Obligation for transparant documentation

• Some new legislation

• Study of substance rules in tax havens

• Taylor made agreements

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Knowledge groups

• Fiscal-law knowledge groups

• “Combat groups” against

(tax avoidance/evasion)

• Co-ordination of actions against fraud

• Knowledgegroup for very large organisations

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800 experts handling very large organisations

• Tax inspectors• Tax auditors• Tax collectors• Client co-ordinators• Managers• Administrative

support

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3 levels in education

• 1. University (external)• 2. Intermediate (internal)• 3. Lower (internal)

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Process of selection:orientation in 2 directions

• Mass production– only special risks & selected risks for small

companies and individuals

• Tailor-made production– complex companies & very large companies

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Tailor-made productionvery large enterprises

• Central role of the accountmanager /client co-ordinator

• Try to make a convenant

• Tailor-made risk finding

• Support bij an information system (ATK)

• Plan of handling

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Selection process “tailor-made”

Two steps:• Co-ordinator (spider)

– analyses the risks of his/her clients

• Selection team– negotiating about risks that have to be handled– deviation of risks between specialists

Role of the “ATK “ (information)system

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Audit-plan large enterprises

• Based on the plan of handling

• Tax control framework

• Risk oriented approach

• Partial or full audit

• EDP assisted

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Role of the co-ordinator • Initiator

• Match-maker between specialists and company

• Negotiator

• Specialist in own discipline ( b.e. transferpricingaudits)

• Communication problem solver

“The one everyone can blame if something goes wrong”

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Preliminary consultations

• Special rules and instructions for tax rulings.

• European demension

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New developments

• Convenants with very large organisations

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The End