Last week a Dutch independent working group consisting of top public service officials released a comprehensive report (click here, available in Dutch only) with recommendations to enhance the Dutch tax system. These recommendations may be used by political parties during the current formation of our new Dutch government. The report emphasizes the need for a stable tax environment to maintain the Netherlands' competitive business climate, which has lately become a topic of discussion in the Netherlands. The report provides both suggestions for loosening of certain tax rules as well as further tightening.

We have summarized the key recommendations below:

  • EU-harmonization of the expat regime, especially the 30%-ruling, to maintain its benefits for the business climate, urging EU-level alignment and discouraging unilateral limitations.
  • Loosening of the 30%-ruling requirements:
    • Reversal of the 2024-tightening of the 30%-ruling;
    • Introduction of a 35%-25%-15% approach (exemption of 30% in first 20 months, 25% in second 20 months en 15% in the last 20 months);
    • Increase of the salary cap from EUR 233,000 to EUR 500,000;
    • Decrease the base salary condition to modal wage (approx. EUR 40,000);
  • Loosen tax depreciation rules to allow for a higher depreciation of owner-occupied buildings, i.e. to 50% (currently: 100%) of the value determined by the Valuation of Immovable Property Act.
  • Introduction of a flat corporate income tax rate of 24%, eliminating the current dual-rate system to align with the European average and enhance competitiveness.
  • Introducing a refundable tax credit for technology firms, merging existing incentives into a simpler system compliant with Pillar Two rules, focusing on non-profit-dependent benefits.
  • Adjustment of the ATAD earnings stripping rule by raising the EBITDA cap to 25% (currently 20%) while reducing the deductible threshold from EUR 1,000,000 to EUR 500,000, which should increase a more equal treatment of equity and debt for Dutch tax purposes.
  • Suggesting a special tax credit for stock options in start-ups and scale-ups to make this remuneration form more appealing.

The report provides welcome suggestions and underscores the importance of a sound tax policy for a strong business environment and suggests that these measures could be integrated into the new government's coalition agreement.

We invite you to reflect on the implications of these recommendations for your industry or sector. For those interested in a deeper exploration of our findings or in discussing their potential impact further, we welcome your inquiries. Please feel free to contact us through the provided channels.

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