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Dutch port authorities to appeal against European Commission tax demand

DUTCH seaports have appealed against a European Commission order that they pay the corporation tax starting next January.

The Dutch ports argue this is unfair because unlike other ports, they do not receive financial help from the government, but must make their own way generating their own revenues.

"What's sauce for the goose is sauce for the gander," said Paul Smits, financial director of the Port of Rotterdam Authority.

In a statement made with the Amsterdam Port Authority, Groningen Seaports, the Moederdijk Port Authority, the Port of Den Helder and Zeeland Seaports, Mr Smits said they would appeal.

"We are not against paying corporation tax, but then it should apply to all European seaports," he said.

"Ports with which we must compete do not pay corporation tax and, in addition, are even supported by their governments," Mr Smits said.

"The payment of corporation tax will come at the expense of our investments in the port complex. The purpose of this cannot be to increase unfair competition,?he said.

Last year, the States General of the Netherlands had made an exception in the law for port authorities: they did not have to pay corporation tax because they were not competing with private parties, but with foreign ports and with each other.

The Dutch legislature did this because port authorities in, for example, Hamburg and Antwerp receive support from the government by respectively covering losses or co-funding port infrastructure.

But the European Commission decided to overrule the Dutch parliament provision to give a special position of the seaports.

In the legal proceedings, the port authorities will principally allege an infringement of the principles of proper administration, such as equality and proportionality.

The Port of Rotterdam Authority would have to pay about EUR60 million (US$67.5 million) in corporation tax per year on the basis of the most recent annual figures.

This comes on top of the EUR90 million the Port Authority pays to the Municipality of Rotterdam and to the State.

The Port of Rotterdam Authority also contributes regularly to the costs of public, national infrastructure in Rotterdam.

For example, earlier this month the Port Authority announced that it will be contributing EUR100 million to the re-routing of four kilometres of public railway line.