Tesla avoids paying billions through the Netherlands: a trend

Elon Musk often calls tax tricks “shady.” Yet recent research shows that his own company, Tesla, saved hundreds of millions of dollars through an ingenious route via Amsterdam and Singapore. This sheds new light on the Netherlands’ role as a tax hub for the world’s largest companies.

Tesla’s Amsterdam Route

Tesla reported a federal tax bill of zero dollars in the United States for 2025. This is not an isolated incident, but a pattern that has persisted for nearly twenty years. Despite total U.S. revenue of $264 billion during that period, the automaker almost never paid federal income tax. Part of this success is due to green energy subsidies and prior losses.

However, a Reuters investigation reveals that there is a hidden mechanism behind this. Tesla funneled approximately $18 billion in profits through its Dutch entity TM International and a branch in Singapore. These profits were not taxed in either country. Experts estimate that this arrangement has saved Tesla at least $400 million in U.S. taxes.

The heart of this operation is located in an unassuming building in Amsterdam-Zuidoost. On Burgemeester Stramanweg stands a gray-and-red building bearing Tesla logos. It houses a showroom, a workshop, and some offices. The financial reality behind this facade, however, is enormous. In 2023 and 2024, the Dutch branch generated annual revenue of $28 billion. That is nearly thirty percent of the parent company’s total global revenue. Yet the specific entity TM International has not a single employee on its payroll. Nor is the firm required to file annual financial statements with the Chamber of Commerce. A local manager confirmed to Reuters that the branch is effectively a shell company. He stated unequivocally that all major decisions are made in Austin, Texas. The tax structure is managed entirely from the United States. This confirms experts’ suspicions that the Dutch unit serves solely as a financial conduit for profits generated elsewhere.

A broader pattern among tech giants

Google became world-famous for the “Double Irish, Dutch Sandwich” scheme. This is a tax trick that allowed companies like Google to funnel their profits through virtually tax-free for years. In short, a company sets up two Irish subsidiaries, one of which is officially based in a tax haven. Profits flow through a Dutch intermediary—which imposes little tax on such cash flows—to that company in the tax haven. This largely avoids paying taxes in Europe. The scheme exploited differences in national rules and yielded billions in savings. Ireland, the Netherlands, and international organizations have since tightened the rules, making this approach far less effective today.

Internationally, the Netherlands is still known for the presence of many mailbox companies. Although the rules are becoming stricter, the volume of suspicious registrations remains high. Data from Moody’s shows that the Netherlands has nearly 380,000 “red flags” in the commercial register. This places our country ninth worldwide in terms of suspicious corporate structures. These firms often have no real economic presence. There are no factories, no innovation centers, and no employees.