12-04-2011
Dutch Senate adopts bill to safeguard taxpayer's rights

The Dutch Senate adopted a bill on 12 April 2011 intended to safeguard the taxpayer’s rights in the event of a tax inspection by the Dutch Tax Authorities. As a result all information requests made by the tax authorities must be laid down in an official ruling from the Inspector. This allows the taxpayer the opportunity to lodge an objection in appeal proceedings should he or she receive an unreasonable request from the Inspector.

Taxpayers are now obliged to provide information on request. Taxpayers not complying with such request are punishable. The tax authorities are also entitled to impose a tax assessment on the basis of an estimate. The taxpayer is, in turn, entitled to object to this assessment but in such case the burden of proof rests with the taxpayer and not the authorities. This means that it is the duty of the taxpayer to prove that the assessment is too high. In practice, this is an almost impossible task.

To date, taxpayers were not allowed to object to requests for information from the tax authorities. The new act now requires that such requests by the tax authorities be (eventually) laid down in a ruling, which may consequently be appealed by the taxpayer. Consequently, as stated above, taxpayers who find such request unreasonable, will now have legal protection.

The new procedure includes the following steps:

• the tax authorities submit an informal oral or written request for information, which may not be objected against;
• the taxpayer may subsequently, within ten days, request a formal decision from including this request from the tax authorities, which may then be appealed;
• after issuance of such decision the taxpayer may lodge an objection;
• the taxpayer may also request a preliminary injunction for suspension of this request.

The tax authorities are not obliged to issue a decision. Consequently, if they decide against granting a ruling, the burden of proof will remain with the tax authorities.

If you as taxpayer receive a request from the tax authorities after entry into force of this act, you will be entitled to object to this request. VMW Taxand can advise you on the possibilities available to you in such case. We can also assist you with the objection and/or request procedure.

For more information, please contact: Roelof Vos (roelof.vos@vmwtaxand.nl) or Frank Buitenwerf (frank.buitenwerf@vmwtaxand.nl).