Companies channeled $221bn into low tax countries last year, with Luxembourg and the Netherlands accounting for much of the investment flow, according to a new report by a United Nations think-tank.

The UNCTAD report says investment flows to offshore financial hubs were increasingly volatile last year, but that after a sharp decline in 2014, flows to the Netherlands rebounded, reaching $148bn in the third quarter of the year, their highest quarterly level since 2007.

Much of this money came from Luxembourg and Britain, UNCTAD said.

In the fourth quarter, however, investment flowed away again and this may be connected with the introduction of new rules to stamp out tax evasion, UNCTAD said.

The Netherlands, for instance, adopted new requirements for group financing and licencing companies as well making it easier to exchange of information about companies with little actual presence in the Netherlands.

The Netherlands has thousands of letter box companies set up by companies to take advantage of its generous tax regime for multinationals.

‘The tight interrelation between SPE flows in Luxembourg and the Netherlands highlights the existence of dense and complex networks of these entities in both countries, with capital flowing rapidly among them in response to financing needs and tax planning considerations, the report said.

Dutch finance minister Jeroen Dijsselbloem said on Monday the Dutch trust office sector faces tighter regulation which will make it easier to withdraw the licences of trust offices and ‘name and shame’ those which break the law.