CKAIR discuss draft Kingdom law amending the tax regulation between the Netherlands and St. Maarten

GREAT BAY--Parliament’s Permanent Committee of Kingdom Affairs and Inter-Parliamentary Relations (CKAIR) on Tuesday addressed a draft Kingdom law proposing amendments to the tax regulation between the Netherlands and St. Maarten, in part to implement outcomes of the OECD Base Erosion and Profit Shifting (BEPS) project, along with other amendments. The chair referenced that the Netherlands and St. Maarten tax regulation, known as the BRNS, has been in effect since March 1, 2016 and aims to prevent double taxation and non-payment of taxes.

The OECD/G20 Base Erosion and Profit Shifting (BEPS) Project is a global initiative to stop multinational corporations from exploiting tax loopholes to shift profits to low/no-tax areas, ensuring profits are taxed where value is created. Launched in 2013, it resulted in a 15-point Action Plan and the Inclusive Framework, establishing international rules, including the two-Pillar solution with Pillar 2's global minimum tax, to create a fairer, more transparent system, with over 145 countries participating.

Members were informed that the Finance Committee of the Dutch Second Chamber submitted a report on December 11, 2025, and that the Kingdom government still had to issue its formal note of response, expected soon. More information can be found here: https://www.oecd.org/en/publications/2023/10/oecd-development-co-operation-peer-reviews-netherlands-2023_fc6a3795.html

The committee noted that St. Maarten’s Parliament can submit a report to the Second Chamber under the procedure of the Kingdom Charter, and that the Second Chamber had already been informed that St. Maarten might be interested in doing so. Attention was also drawn to a point raised in the Second Chamber report, referencing that St. Maarten’s tax system has remained unchanged since 2016 and is currently being revised, with questions about the timeline and whether local reform could create obstacles to implementing anti-avoidance measures.

MP Sarah Wescot-Williams stressed that this Kingdom law cannot be viewed in isolation from the broader tax reform debate in St. Maarten. She referenced ongoing requests in Parliament for updates on tax reform and argued that St. Maarten’s tax administration has long been structurally weak, with repeated reform attempts over decades. Her position was that parliamentary handling of this draft should be connected to a comprehensive government update on tax reform, including the priorities and sequencing within the country package, especially as the program approaches its endpoint and government must set priorities.

MP Raeyhon Peterson supported the need for alignment with the Minister of Finance and emphasized Parliament’s constitutional responsibility regarding taxation. He cautioned that changes introduced through a Kingdom law, if not properly tracked and explained locally, can lead to surprise impacts on residents and businesses, even if the measure is legally valid at Kingdom level. He urged consistent communication so Parliament understands what changes mean in practice and can properly inform the public.

Chairlady MP Sjamira Roseburg also flagged the need for clarity from the Ministry of Finance before Parliament finalizes its position. She outlined additional questions she wants addressed, including what avoidance structures are being targeted, whether tightening rules could result in additional taxation in St. Maarten, whether the country has the capacity and expertise to implement and enforce the new rules, how the amendments relate to local tax reform, and whether stakeholders were consulted during drafting.

The committee concluded that a report on the draft Kingdom law will be drafted and sent onward for further handling, while also recognizing that it may be most effective to proceed after receiving a formal response from the Minister of Finance on government’s position and the status and timeline of tax reform.

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