Dutch govt commission says mailbox companies have little benefit to economy

A commission appointed by the Dutch government to study "mailbox", or "shell" companies said on Monday it has found that they have little or no benefit to the country's economy.

A commission appointed by the Dutch government to study "mailbox", or "shell" companies said on Monday it has found that they have little or no benefit to the country's economy. Such companies are difficult to define but often they have little or no physical presence in the Netherlands and hold or transmit large sums of money to parent companies abroad.

Tax justice advocates have criticised the Dutch government for more than a decade for allowing such companies to flourish, arguing they deprive other countries of tax revenue. The commission, appointed in February by the Finance Ministry, largely agreed with the critics' assessment.

"Mailbox companies don't add much to the Dutch economy, they disadvantage developing countries disproportionately ... and damage the Netherlands' reputation," the commission wrote. It recommended the government improves supervision of the sector and forces companies to provide more disclosure about their activities, which it said would lead to the departure of many and bring the Netherlands more into the mainstream of international practice.

The commission estimated there were 12,400 such companies registered in the Netherlands as of 2019, holding 4.5 trillion euros ($5.07 trillion) in assets -- more than five times Dutch GDP. It said about 170 billion euros flowed through such companies annually from 2015-19, and the companies' presence creates 3,000 to 4,000 jobs in the Netherlands.

Tax revenues from the companies were about 650 million euros in 2019 - or about 0.2% of all tax revenues. A spokesperson for caretaker Prime Minister Mark Rutte's government was not immediately available to respond to the commission's findings. ($1 = 0.8879 euros)

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