The Netherlands, a small country with a big impact, has become the world’s hotspot forholding companies. With over 527,000 registered holding entities, the country boasts the highest concentration globally, outpacing the USA and France.
The Numbers Behind the Trend
According to BoldData, the Netherlands is home to more holding companies than any other nation. For comparison:
- – Netherlands: 527,000 holdings
- – United States: 375,079 holdings
- – France: 240,673 holdings
The country’s central location in Europe, combined with tax-friendly policies for business incorporation, creates a unique appeal for businesses looking to optimize cross-border operations.
Why Businesses Choose the Netherlands
The Netherlands is widely recognised as a ‘tax-efficient’ jurisdiction. Its favourable policies attract not just multinational corporations but also smaller enterprises from across the globe. For instance:
- – U.S.-Owned Holdings: Over 2,000 entities have established themselves in the Netherlands, drawn by its stable and business-friendly environment.
- – Cyprus Connection: Smaller economies like Cyprus have seen a 700% increase in foreign holdings in the Netherlands over the last 15 years.
- This trend underscores the Dutch tax system’s ability to provide businesses with efficient solutions for managing international operations.
UK Companies Flock to the Netherlands
In recent years, UK businesses have turned to the Netherlands following the UK’s departure from the UK, in the from of Brexit, and to mitigate rising tax pressures at home. The numbers speak for themselves:
- – 320% growth in UK-owned holdings in the Netherlands over the past decade
- – An increase from 320 entities in 2014 to 1,352 in 2024
- – This migration is driven largely by a tax environment in the UK that has become less accommodating for businesses.
The UK’s Business Challenges
Following Brexit, UK business are finding it much more difficult to work and sell into the European market. In fact, many businesses are now required to use a European hub in order to sell products into European markets. In addition, a recent £40 billion tax package introduced by Chancellor Rachel Reeves has made the UK less appealing for some companies. The most notable change? A 1.2% increase in employer national insurance contributions to 15%, set to take effect in April 2025.
This rise has sparked concerns among business leaders and advocacy groups. Elliot Keck, head of campaigns at the TaxPayers’ Alliance, expressed his worries:
“Taxpayers will be concerned about companies closing up and leaving. The chancellor’s hike in employer’s national insurance will only drive more wealth creators and businesses into the arms of lower-tax countries. Rachel Reeves needs to be supporting businesses, not slamming them.”
The Dutch Advantage
For businesses around the world, the Netherlands offers more than just a tax-friendly environment. Its strategic location in Europe, political stability, and efficient infrastructure make it an ideal base for companies with global ambitions.
The Future of Holding Companies
As trade barriers and tax pressures rise in countries like the UK, the Netherlands’ reputation as a business haven is likely to grow even stronger. Its current ability to balance favourable policies with a robust regulatory framework ensures that it remains a top choice for businesses seeking growth and stability in a complex global landscape. Whether you’re a multinational corporation or a small business owner, the Dutch advantage is worth considering for businesses seeking to make strategic moves or open a European base.