Profit tax fraud has cost the tax authorities far more money than previously assumed. The Dutch treasury is said to have lost about 27 billion euros between 2000 and last year. This was reported by several European media outlets, including Follow The Money and the BBC, based on the joint research project The Cumex Files.
The so-called VP/former fraud costs the tax authorities of the United States, Germany and at least ten other European countries a total of about 150 billion euros. This is three times what was previously estimated. The Netherlands would be relatively hard hit.
The trick was to buy and sell large parcels of shares very quickly, close to the dividend date. Profit tax was refunded multiple times, while dividend tax was paid only once. Germany’s highest court ruled at the end of July that the ruse was illegal. The banks allegedly involved in the fraud include big names such as Morgan Stanley, Deutsche Bank, UBS, BNP Paribas, JPMorgan Chase and Santander.
German authorities have also raided the ABN AMRO office in Frankfurt on several occasions in connection with the case. The investigation into the case is still ongoing. In the Netherlands, the Bank also supports the Public Prosecution Service. Justice has identified the bank as a suspect in an investigation into profit tax refunds by a third party.
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