The Upper House of the Dutch Parliament has approved – as a formality – the bill in amendment of the tax entity regime forming part of the corporation tax system. The amendment in question had been prompted by European Court of Justice Rulings pointing to inconsistencies between the old regime and current EU regulations.
The draft legislation which has now been passed has opened the door to the introduction of another two tax entity scenario: first, that of a tax entity between a Dutch-based parent company and a Dutch-based sub-subsidiary the shares in whose capital are held by a subsidiary company that is based in another EU or EEA Member State, and second, that of a tax entity between Dutch-based sister companies whose mutual parent is based elsewhere within the EU or EEA.