The Commission has requested the Netherlands to end the discriminatory taxation of dividends received on shares held by insurance companies established elsewhere in another Member State or in an EEA country (Norway, Lichtenstein and Iceland).
Dutch insurance companies are effectively not taxed on dividends received on shares held in the framework of unit-linked insurances. They can deduct the increase of the obligation to pay the dividends on to their policyholders from the dividends received. This reduces the corporate tax base concerning these dividends to zero, while any withholding tax is credited. However, The Netherlands taxes insurance companies established in the EU or the EEA receiving Dutch dividends on shares held in the framework of unit-linked insurance on the gross dividends, without the possibility of a credit. In line with case C-342/10 Commission v. Finland, the Commission considers the higher taxation of insurance companies established elsewhere in the EU/EEA incompatible with the freedom of capital movement under Article 63 of the Treaty on the Functioning of the European Union and Article 40 of the European Economic Area (EEA) Agreement. The request is in the form of a reasoned opinion. In the absence of a satisfactory response within two months, the Commission may refer the Netherlands to the EU’s Court of Justice.
Globe Refund protects the rights of the EU/EEA insurance companies by claiming the withholding tax on dividends and interests to tax authorities. Contact us for a full analysis of your refund opportunities.