Multinational corporations usually own projects in other countries through offshore holding companies. Holland has been a popular location in the past for such holding companies because there is little tax on earnings passing through Holland, and it has a broad network of tax treaties with other countries that help in reducing withholding taxes collected by other countries where projects are located.
In recent years, Holland has had competition from Luxembourg, Denmark and other jurisdictions with their own treaty networks for holding company business.
Holland collects a 0.55% capital tax on money that a parent company contributes to a Dutch holding company — for example, to invest in an offshore project. The Dutch finance ministry said on March 24 that it plans to eliminate the capital tax effective next January 1. The proposal must still be approved by parliament.