On 31 May 2023, the bill on the Minimum Profit Tax Act 2024 was presented to the Lower House of Parliament.
The proposal ensures that multinational groups and domestic groups with an annual revenue of €750 million or more pay tax on their profits at an effective rate of at least 15%. By introducing this legislation, the Netherlands is implementing an international agreement concluded in October 2021 by 138 countries.
Companies will only pay the new top-up tax if the group to which they belong pays a corporate income tax at an effective rate that is lower than the minimum tax rate. This will be determined by deducting the effective tax rate calculated for that state from the minimum tax rate of 15%. The minimum tax rate of 15% has been agreed internationally.
A global minimum level of taxation (Pillar Two) is part of the OECD agreement on the reform of the international tax system, to which 138 countries have signed up. The European Commission proposed a directive on implementing this minimum level of taxation in the EU. EU member states reached unanimous agreement on this proposal on 15 December 2022. Member States are obligated to implement the directive in their national legislation by 31 December 2023. The Netherlands has launched an online consultation on the draft implementation bill at the end of 2022. After the responses to this consultation had been processed, the bill was submitted to the Council of State for an advisory opinion.
The bill will be debated by the House of Representatives in the coming months, and then by the Dutch Senate. The bill is expected to enter into force on 31 December 2023.