April 24, 2018 / 9:53 PM / a month ago

Dutch government memos: Tax cut was 'decisive' for Unilever's headquarters choice

AMSTERDAM (Reuters) - The scrapping of a Dutch tax on dividends was “decisive” for Unilever in deciding whether it would choose the Netherlands or Britain as its base, according to memos released by the Dutch government as part of a domestic political row on Tuesday.

FILE PHOTO: Traffic and people pass by the front of the Unilever building in central London, Britain, March 15, 2018. REUTERS/Hannah McKay/File Photo

The memos compiled in the summer of 2017 as Prime Minister Mark Rutte was engaged in negotiations to form a government recorded lobbying by both Shell and Unilever against the tax, which forced them to maintain awkward dual share structures in order to ensure British investors were not disadvantaged.

One memo dated Aug. 25, 2017 said “the picture has changed” and Unilever was preparing to choose a head office “in the very near term.”

“The dividend tax is decisive in that” choice, the memo said.

Rutte’s government announced it would scrap the 15 percent withholding tax on dividends when it came to power in October 2017.

Unilever delayed a decision until March 2018, citing a fevered political atmosphere surrounding Britain’s departure from the European Union. It then chose Rotterdam rather than London, to house its headquarters.

Reporting by Toby Sterling; Editing by Sandra Maler

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