Dutch Tell European Debt Security Issuers About New VAT Hit

Law360 (March 17, 2020, 1:27 PM EDT) -- Dozens of European issuers of collateralized loan obligations have been told by the Netherlands that those instruments will be subject to an annual 21% value-added tax if they're composed of Dutch-domiciled special purpose vehicles, according to regulatory filings.

In February, the Dutch tax authority notified at least 26 Europe-based financial firms that had issued about 90 such CLOs that VAT would apply to the vehicle's management fee, the issuers disclosed in notes to their investors filed with the London Stock Exchange.

Retroactive to April 2019, Dutch VAT will apply to all outstanding CLOs associated with a Dutch special purpose vehicle, or...

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