International

The Netherlands is planning to write off € 2.5 billion (£1.81bn/$3.7bn) in debts owed by one of the few remnants of the country's imperial past, the islands known as the Dutch Antilles. All very well, argues SP Member of Parliament and spokesman on Antillean affairs Ronald van Raak, but only if the islands enhance their future income by imposing a proper level of taxation.

A number of multinationals base themselves in the Antilles, where they pay little or no tax. "The Antilles cannot on the one hand be dirt poor and on the other a tax haven," says Van Raak. "I'm absolutely in favour of debt forgiveness by the Netherlands, as this will enable the Antilles to start afresh with a clean slate. But this shouldn't be carried out in such a way that major corporations contribute nothing at all. Taxpayers in the Netherlands shouldn't be expected to foot the bill to finance the tax advantages of multimillionaires in the Antilles."

The SP suspects that multinationals based in the Antilles, such as US oil giant Valero, pay nothing, or almost nothing, in the way of taxes, despite the fact that the islands have long been mired in a morass of social problems, their authorities having hardly any money to cover urgently needed investment in such things as education, employment and health care.

The Netherlands is currently in negotiation with the various islands which make up Antilles over reform of their status. Curaçao and St. Maarten will become independent countries a year from now, in December 2008, and both have a clear need for tax revenues. Major corporations, which rake in huge profits on these islands, should be expected to make a contribution to this income. Smaller islands - Bonaire, St. Eustatius and Saba – will remain under Dutch jurisdiction, which means that unless action is taken parts of the Netherlands, newly organised as Dutch local authorities, will be tax havens. While the budget for the Dutch Antilles is under consideration, Van Raak will be asking the Secretary of State responsible, Ank Bijleveld, if she will raise the question of tax policy with the Antillian administration.