The Netherlands said it will tighten rules on tax breaks for foreign firms after facing criticism from the EU for offering complicated schemes for multinationals.

Dutch authorities said they were cracking down on “letter box firms” with a Dutch address which allow foreign countries to benefit from lucrative local deals.

“We are making considerable changes to the law in order to prevent the Netherlands from being used as a conduit to tax havens,” Deputy Finance Minister Menno Snel said in a letter to parliament seen

yesterday.

“These changes also mean that letter-box companies established in the Netherlands purely for fiscal reasons, but which do not contribute anything to the Dutch economy, will in future not get any dispensation from the tax authorities,” Snel’s ministry added in a statement.