The Netherlands Implements OECD Pillar One “Amount B”

December 17, 2024

Background

On behalf of the commitment to international tax initiatives, the Netherlands has implemented Pillar One “Amount B” regarding “covered jurisdictions” transactions. This amendment, promoted by the OECD, aims to standardize Transfer Pricing rules for trading and distribution activities, providing greater clarity and tax fairness. 

Pillar One “Amount B”

“Amount B” focuses on simplifying and standardizing the transfer prices applicable to low-risk trading and distribution functions to ensure that companies performing these activities are consistently remunerated under the Arm’s Length Principle. 

Effects on the Dutch Transfer Pricing

  1. Simplification for companies: The “Amount B” guidelines allow multinationals with trading and distribution activities in the Netherlands to manage their Transfer Pricing policies more easily, reducing the administrative burden. 
  2. Reduction of tax disputes: By establishing clear and standardized methodologies, Amount B reduces the likelihood of disputes with tax authorities on the remuneration of these activities. 
  3. Alignment with global standards: This framework reinforces the Netherlands as a competitive tax environment under the OECD’s international standards. 

Benefits for Multinational Enterprises

The standardized “Amount B” approach offers significant advantages for companies operating in the Netherlands, such as: 

  • Tax certainty in the remuneration of distribution activities. 
  • Reduced costs of audits and tax disputes. 
  • Contribution to global tax transparency. 

Conclusion

The implementation of “Amount B” in the Netherlands marks a milestone in the evolution of Transfer Pricing internationally. This amendment improves tax management for companies and reinforces collaboration among jurisdictions to promote tax fairness. 

Call to Action

Is your company ready to adapt to “Amount B”? Contact us for expert Transfer Pricing advice. Ensure compliance and optimize your international operations. 

Source: Mondaq - The Netherlands Implements Amount B Of Pillar One In Respect Of Covered Jurisdictions