New Trends in the Definition of Permanent Establishment: The Netherlands

Abstract

This paper elaborates on current and emerging issues involving the operation of the concept of permanent establishment (PE) in the national tax system and double tax treaty system of the Netherlands. The paper was written as a contribution (country report) to the seminar “New Trends in the Definition of Permanent Establishment”, organized by the Faculty of Economics and Law of the Università Cattolica Del Sacro Cuore under the aegis of the OECD and the Italian Council of Ministers. The seminar was held in Milan, Italy, on 26 November 2018.

Topics addressed in the paper include:
• The operation of the PE concept in the national tax system and double tax treaty system
• Tax treaty practices and departures from the OECD Model
• Signing of the Multilateral Instrument and reservations made and options chosen
• Ongoing developments
• Taxation of the digital economy

Keywords: Permanent Establishment, Base Erosion and Profit Shifting, Multilateral Instrument, Digital Economy

JEL Classification: K34