Dutch Ports to Appeal EC Tax Decision

Maritime Activity Reports, Inc.

March 21, 2016

Photo: Eric Haun

Photo: Eric Haun

The Port of Rotterdam Authority, together with the Amsterdam Port Authority, Groningen Seaports, the Moederdijk Port Authority, the Port of Den Helder and Zeeland Seaports, is going to appeal against the decision of the European Commission which states that Dutch sea ports must pay corporation tax from January 1, 2017.
Paul Smits, Financial Director of the Port of Rotterdam Authority, said, “We are not against paying corporation tax, but then it should apply to all European sea ports. This is a matter of principle for us. The foreign ports with which we have to compete do not pay corporation tax and, in addition, are even supported in various ways by their governments. Within Europe, it should be a question of ‘what’s sauce for the goose is sauce for the gander’. The payment of corporation tax will come at the expense of our investments in the port complex. The purpose of this cannot be to increase unfair competition.”
Last year, the Dutch legislature had made an exception in the law for port authorities: they did not have to pay corporation tax because they were not competing with private parties, but with foreign ports and with each other. The Netherlands did this because port authorities in, for example, Hamburg and Antwerp receive support from the government by respectively covering losses or co-funding port infrastructure. In January, the European Commission decided to overrule the special position of the sea ports in Dutch legislation. In the legal proceedings, the port authorities will principally allege an infringement of the principles of proper administration, such as equality and proportionality.
The Port of Rotterdam Authority would have to pay about 60 million euros in corporation tax per year on the basis of the most recent annual figures. This comes on top of the dividend that the Port Authority pays to the Municipality of Rotterdam and to the State. The dividend amounts to about 90 million euros and is indexed annually. It is not dependent on the profits made. In addition, the Port of Rotterdam Authority also contributes regularly to the costs of public, national infrastructure in Rotterdam. For example, earlier this month the Port Authority announced that it will be contributing nearly one hundred million euros to the re-routing of four kilometers of public railway line.
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