Tax and subsidies
As a taxpaying company, Alliander is liable for various taxes, chief among which are corporate income tax, wage tax, and VAT. Dutch tax law applies to the largest share of this by far, with a small portion, namely our activities in Germany, falling under German tax law. The table below shows the totals per type of tax per country.
Tax payments in 2019
€ million | Netherlands | Germany |
Corporate income tax | 57 | 1 |
Dividend tax | 23 | - |
Wage tax | 170 | 2 |
Sufferance tax | 148 | - |
VAT | 240 | 2 |
Total | 638 | 5 |
In the past, Alliander entered into an Enforcement Covenant with the Dutch Tax and Customs Administration under the ‘Horizontal Supervision’ arrangements. Where there is any doubt about the interpretation of tax law, we engage in advance in a constructive and transparent dialogue with the Dutch Tax and Customs Administration, and with the Netherlands Enterprise Agency where subsidies are concerned. Furthermore, Alliander’s risk management model is reflected in the implementation of our tax strategy, and the Tax Control Framework is used to mitigate risk.
With regard to matters relating to tax and subsidies, we have set the following objectives:
In our financial reporting – in the financial statements for example – we are transparent about the tax we pay.
We are totally transparent vis-à-vis internal and external stakeholders with regard to all relevant records relating to tax and subsidies. Stakeholders include the Dutch Tax and Customs Administration, the Netherlands Enterprise Agency, the Supervisory Board, the Management Board, and internal departments like Human Resources, Regulation, Risk Management, Legal Affairs, and Internal Audit.
For cross-border activities, the transfer pricing rules apply. In this context, a transfer pricing agreement has been drawn up for our activities under Alliander AG, which complies with the applicable rules.
Our focus with regard to subsidies is on schemes that are intended for large corporations rather than those for regional activities. This way, by only applying for such regional subsidies where appropriate, we deliberately leave the field open at regional level for other companies to develop smaller sustainability initiatives. In 2019, we received €1 million (2018: €2 million) in subsidies. We did not receive any subsidies in Germany.