According to Dutch tradition, on Prince's Day (Prinsjesdag), September 19, 2023, the Minister of Finance of the Netherlands Sigrid Kaag announced the budget memorandum. The government's tax collection plans for 2024 and the coming years are now known.
Changes in taxes to one degree or another affect every resident of the country. In this article we will talk about the main groups of tax changes. It should be understood that these changes must still be supported by the Senate, after which they can come into effect from the beginning of 2024.
The government has agreed on the following groups of budget innovations:
Fighting poverty and increasing purchasing power
The government plans to increase a number of social benefits. So:
- The child benefit, kindgebonden budget, will be: 750 euros for an only child; 883 euros for the second and subsequent children, 400 euros for children aged 12 to 17 years.
- The housing allowance, huurtoeslag, will increase to 416 euros.
All benefits increase in the same proportion as the minimum wage
In addition, the government will allocate €50 million to municipalities to provide special assistance to those unable to pay their electricity bills. 64,7 million euros will be allocated to create new and preserve old jobs for people with disabilities. 63,9 million euros will be allocated to help companies working in the social sector. €73,5 million is allocated for the staff retraining scheme – SLIM. Previously, only employees of small and medium-sized enterprises could study under this scheme, but from 2024 the scheme will be available to other residents of the Netherlands. The previously existing private retraining program, STAP, is being closed.
In the Netherlands there are 6,5 thousand households receiving incomes below the level of social assistance. They will receive financial support for the next four years under a temporary scheme. 89 million euros have been allocated for these purposes. It is expected that a permanent scheme to support such households will come into force in 2028.
The fight against climate change
The fixed portion of the BPM tax paid when purchasing a new car or importing a car from abroad will be increased. In 2023, the fixed part of the tax is 400 euros, in 2024 it will increase to 440 euros, and in 2025 it will reach 600 euros. In addition, the tax also includes an amount depending on the vehicle's emissions. The funds from the BPM tax increase are planned to be used to stimulate the purchase of used electric vehicles.
The fee for the emission of carbon dioxide into the atmosphere by enterprises will be increased: from January 1, 2024 it will be 51,7 euros per ton. It is planned that by 2030 this fee will increase to 71,1 euros per ton. In this way, the government encourages enterprises to switch to technologies that are less destructive to the environment.
In order to reduce carbon dioxide emissions, tax breaks for companies using fossil fuels are planned to be eliminated:
- For enterprises of the metallurgical and mineralogy industry - from January 1, 2025,
- For other enterprises with such benefits - from January 1, 2028.
Incentives for fossil fuels and electricity for greenhouse horticulture are planned to be phased out according to the following schedule:
| Year | Greenhouse enterprises belonging to the first exemption group | Greenhouse enterprises belonging to the second exemption group |
| 2025 | 30% of regular rate | 50% of regular rate |
| 2026 | 44% of regular rate | 60% of regular rate |
| 2027 | 58% of regular rate | 70% of regular rate |
| 2028 | 72% of regular rate | 80% of regular rate |
| 2029 | 86% of regular rate | 90% of regular rate |
| 2030 | Regular rate | Regular rate |
The goal is to encourage greenhouse enterprises to use new technologies that do not pollute the environment.
Tax measures affecting the welfare of a wide range of residents of the country
Taxes on income of employees and pensioners:
- The tax benefit for employees will increase by 115 euros if their salary is close to the minimum wage.
- The income tax rate for employees belonging to the second tax group and pensioners belonging to the second and third tax groups will decrease by 3,55%. For persons belonging to the first tax group, the rate will increase by 0,03%.
Excise tax on tobacco and tobacco products
From April 1, 2024, the excise tax on alcohol and tobacco will increase:
- For alcohol - by 16,2%. A bottle of beer will rise in price by 2 euro cents on average.
- The excise tax on cigars and cigarillos will be 11% of the sales price. A pack of cigarettes (20 pcs.) will rise in price by 1,7 euros, a pack of tobacco (50 g) - by 7,14 euros.
Transport sphere
The following changes are planned:
- Raising the tax on the purchase of new cars and importing them from abroad (described above).
- From January 1, 2026, the transport tax on campers (motorhomes) used for personal purposes will be increased by 25% - it will be 50% of the standard rate for passenger cars.
- From January 1, 2026, transport tax benefits for cars equipped for transporting horses will be cancelled. Currently, owners of such vehicles pay a quarter of the rate for passenger cars.
- From January 1, 2026, fuel tax benefits for cars running on liquefied gas are cancelled.
- From January 1, 2026, owners of vehicles equipped for transporting money will not be able to return transport tax.
- From January 1, 2030, owners of buses running on liquefied gas will have to pay transport tax.
Changes in Box 3
It is planned that from January 1, 2027, tax will be paid not on fictitious capital income, as now, but on real one. During this time, the government must develop a system for assessing this income.
The share in the assets of the owners' association and the assets held in a third-party account of the notary or bailiff will not be considered as investment, but as bank and savings balances. Such balances will be taxed at a rate of 0,36%. Investments and other assets will be taxed at 6,17%, and debts at 2,57%. Debts between tax partners and between parents and children will not be taxed. It is expected that these changes will take effect retroactively from January 1, 2023.
Entrepreneurial activity
The EMZ entrepreneur deduction is reduced from the current 5030 euros to 3750 euros. Tax exemption is reduced from the current 14% to 12.7%. You will have to pay more taxes.
Adjustments are being made to the business succession exemption (BOR) and transfer of substantial interest (DSR ab) schemes. These schemes are aimed at preventing businesses from closing because the new owner does not have the money to pay taxes. The state wants to maintain this goal, but avoid abuse, so it is proposed not to apply these schemes:
- from January 1, 2024 - to real estate for rent,
- from January 1, 2025 - do not apply the BOR scheme to investment assets of private companies (currently up to 5% of business assets are exempt). The DSR ab circuit will be changed later,
- From January 1, 2025 - to property used for personal purposes worth over 100 euros (expensive cars, yachts, etc.).
In addition, as of January 1, 2025:
- The requirement for a person donating a significant stake in the company to be required to work for a company for three years will be eliminated.
- The BOR and DSR ab schemes will only apply to donations made to persons aged 21 years or older. This requirement will not apply to inheritance.
- The tax scheme for the transfer of property rights will also change. The tax-free part will increase to 1,5 million euros, the remaining part will be taxed not fully, but partially. Currently, the tax is paid on 17% of the amount exceeding 1,5 million euros, and will be paid on 30% of this amount.
Also:
- From January 1, 2024, access to reinvestment reserves will be simplified.
- From 1 January 2025, the new property transfer scheme using shares will be abolished.
- From January 1, 2024, entrepreneurs will be able to more easily provide their employees with travel cards.
More details about the budget memorandum - on the government website.
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