On December 15 2011, the Dutch government released a bill to introduce a bank tax which is expected to enter into force in mid-2012. The stated objectives of the bank tax are to ensure that the banking sector contributes to the costs of stabilisation, to stimulate long-term financing and to discourage excessive bonuses for the board members of Dutch banks.
According to the bill, the potential taxpaying banking entities under the bank tax will be: Dutch resident entities that have been granted a banking licence by the Dutch Central Bank; EU/EEA resident entities that operate as banks in the Netherlands through a licensed Dutch branch; and other foreign resident entities that operate in the Netherlands as a bank through a licensed Dutch branch.
The banking entities will only be liable for the levy if the standalone commercial balance sheet total of such an entity that forms part of the Dutch group or the Dutch part of the international group, exceeds the so-called efficiency threshold of €20 billion ($26.4 billion).
The taxable amount is the amount of the balance sheet total as at the end of the preceding financial year, reduced with the sum of the efficiency threshold; the amount of the original own funds; the amount of deposits which are covered by the insurance scheme; and liabilities that relate to insurance activities (if any).
With respect to the applicable tax rate, the taxable amount is divided in two parts based on the pro rata between short-term liabilities with a term of less than one year and long-term liabilities of the taxpayer. The amount of the short-term liabilities is subject to bank tax at a rate of 0.022%, while the amount of the long-term liabilities is subject to bank tax at a rate of 0.011%.
These rates will be increased by a factor of 1.05 if the taxable entity has paid an excess bonus to at least one of its board members in the relevant financial year. An excess bonus is defined as a variable remuneration which exceeds 100% of the fixed remuneration of a board member.
The bank tax will be due every first day of the 10th month after the end of a financial year. The bank tax will not be a tax deductible item for purposes of Dutch corporate income tax, and will be levied on a self-assessment basis.
Due to the high threshold, only a few banks should be impacted. Smaller Dutch banks and foreign (non-Dutch) banks with limited activities in the Netherlands are unlikely to feel an impact.