The consequences of the 2016 Tax Plan

EY’s vision on the Dutch Tax Plan.

Budget Day 2015: You will be better off next year!

The third Tuesday of September is an important day in the Netherlands. Not just for Dutch politics but also for you. That’s why we give you an overview of the most important tax measures from the 2016 Tax Plan and other tax legislative proposals.

Good news. Most Dutch citizens will be better off financially next year. Those who earn a minimum wage will benefit the most. One of the reasons for this is an increase in employed person’s tax credit. Another reason is the lower income tax rates in the second and third tax bracket. The plan to reduce the purchasing power of elderly citizens and people receiving benefits has been cancelled.

The Dutch government intends to reduce the tax burden on employment by € 5 billion. This will give a boost to the employment rate and increase the purchasing power of working people. The government expects that consumer spending will give a boost to the economy and employment rate. The proposed measures in the 2016 Tax Plan should lead to 35,000 extra jobs.

We would like to remind you that State Secretary Wiebes expressed the ambition last year on Budget Day that 100,000 new jobs would be created thanks to new tax measures. This proposal only helps to realize part of this ambition. So these new measures cannot really be defined as a major tax reform. The proposals of Budget Day 2015 are more about adjusting existing tax measures. We await a true tax reform in the future.

Simplifying the tax system is and will continue to be the focus of this government. There are proposals in the tax plans presented on Budget Day 2015 that will simplify the tax system in the Netherlands. At the same time, the government states that a heavier administrative burden will be the case, particularly for businesses. This is mainly because international tax legistation will be implemented. Even though certain aspects of the tax system will indeed be simplified, we would like to express the strong wish that there will be a major simplification of the tax system as soon as possible.

These legislative proposals are not final yet. During the parliamentary debates there may well be changes. We expect that this will happen in a number of cases. Certain proposals will not be received with open arms. Think about the plans that will increase the administrative burden or even result in overkill. In addition, the changes in the taxation of savings and investments is still very much under discussion. We will, of course, closely follow the latest developments regarding the government plans. You can rely on us to keep you informed of all the latest news on our website and social media.

Should you have any questions, please don’t hesitate to contact our expert professionals presented in the brochure. 

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