Why invest in Holland?
1. Great Location, business climate and education
The Netherlands has a strategic coastal location with access to some 500 million consumers in western Europe. It has excellent logistics infrastructure including the Port of Rotterdam which is the largest in Europe. Not to mention its excellent ICT connectivity, internationally-oriented workforce (who speak excellent English) and favourable business and tax climate. The Netherlands is also a great place to live, with a good standard of living, safe cities and a top-notched schools.
That’s why more than 6,300 foreign companies have already established over 8,110 operations in the Netherlands. Among the many prominent international companies that have taken advantage of NFIA (the Netherlands Foreign Investment Agency) services as they located their operations in the Netherlands, are North American companies like Abbott Laboratories, Boeing, Bombardier, Cisco Systems, Dow, Eastman Chemical, Heinz, Medtronic, NCR Corporation and Reebok. They also include European companies such as Bosch, Danone, Siemens and RWE. Additionally, NFIA assisted a large number of companies from Asia and the Middle East in their location selection, companies such as Astellas, BenQ, Daewoo, Fujifilm, Giant, Hitachi, Huawei, ICBC, LG Electronics, SABIC, Samsung, Saudi Aramco, Tata Consultancy Services, Teijin and Yakult.
In 2014, foreign companies made inward direct investments worth US$ 664 billion or 82.2% of the Netherlands' GDP. As a result, the Netherlands is the world’s tenth-largest recipient of foreign investment. Foreign investors provide 15% of Dutch employment in the private sector (935,310 jobs).
2. Effective government
The Netherlands is a stable and vibrant parliamentary democracy, recognized worldwide for its transparency, fairness and effectiveness. According to the World Bank, the Dutch government is one of the most effective in the world. Our political system is characterized by plurality and consensus-building, resulting in coalition governments that truly represent the voice of the people. The Dutch were one of the first countries in the world to give women the right to vote (1922).
3. Fair and transparant Legal System
The legal system is fair and transparent and well equipped to deal with business, trade, taxation and patent issues. There are specialized courts for dealing with criminal and administrative issues, as well as with tax law, planning law, environmental law and trade and commerce. There is a rich variety of world-class law firms – both home grown and large international ones – that can provide assistance with tax law, mergers and acquisitions, and European law. The Hague is the seat of the European Patent Office.
4. Beneficial tax system
- The Dutch tax system has a number of features that may be very beneficial in international tax planning.
- The relevant factors include a corporate income tax rate of 20% on the first € 200,000, and 25% for taxable profits exceeding € 200,000, which is well below the EU national average.
- Companies can benefit from an effective tax rate of only 5% for R&D income from self-developed patented intangible assets and also from self-developed unpatented intangible assets which qualify for the so-called WBSO.
- The Dutch ruling practice, which provides clarity and certainty on tax assessments in advance, can be obtained on future transactions, investments or corporate structures.
- There is also a broad tax treaty network. The Netherlands has signed treaties with more than 80 countries that ensure the avoidance of double taxation on income and capital. This reduces withholding taxes on dividends, interests and royalties (for interest and royalties, in some cases, taxes are reduced to 0 %).
- There are no withholding taxes on outgoing interest and royalty payments.
- Dutch tax law also provides the participation exemption, which states that all benefits related to a qualifying shareholding, including cash dividends, dividends-in-kind, bonus shares, hidden profit distributions and capital gains, are exempt from Dutch corporate income tax.
- Investors can benefit from a 30% tax break for highly qualified foreign employees
5. Well-developed financial system
The Netherlands has a well-developed financial system that is largely focused on global financial markets and trends. It is centered largely around Amsterdam, which hosts some of the most notable global banks of Dutch origin, among them ING Group, Rabobank and ABN AMRO, and large international banks. In addition, we host a broad range of private equity investors and venture capital funds, as well as trust fund managers. Amsterdam, the country’s financial center, hosts the Euronext Amsterdam exchange, which is part of NYSE Euronext, as well as Atradius, the world’s largest credit risk management company. ABP is one of the largest pension funds in the world.
The Netherlands foreign investment agency (NFIA)
The Netherland Foreign Investment Agency, an operational unit of the Ministry of Economic Affairs, assists companies at every stage of establishing or expanding operations in Holland. NFIA offers:
- The organisation of fact-finding missions
- Arranging meetings with relevant partners
- Providing personalised guidance and counsel on tax, government and permit procedures, location options and business solutions
Throughout the years, NFIA has supported thousands of companies from all over the globe, including Bombardier, Cisco, Danone, Fujifilm, Huawei, LG Electronics, SABIC, RWE and Tata Consulting Services, to successfully establish their business in the Netherlands.