POLITIC PARTIES IN THE NETHERLANDS SUGGEST A NEW WEALTH TAX BILL

03/02/2022

As there is a growing inequality of wealth in The Netherlands and this is visible through for example the housing market, the political parties PvdA, GroenLinks and SP are coming up with their own bill for what they call "a fair wealth tax." These opposition parties want a so-called progressive tax: the higher the capital, the more tax has to be paid on it.

 

This bill will be drafted having the best interest of “Normal savers” at heart.  According to the parties, the proposed tax bill only applies to assets of at least 100,000 euros or 200,000 euros for two-income households. No wealth tax will have to be paid on the value of a house owners own-occupied home.

 

The bill proposes that those who own between 100,000 and 500,000 euros in savings or investments, for example, will pay 1 percent tax on this in the proposal. This will gradually increase to 5 percent for assets over 5 million euros. The proposal is intended to help reduce wealth inequality and ensure that the wealthiest pay "a fair contribution" to public services.

 

The initiators point out that the Supreme Court recently drew a line under the way in which assets above 50,000 euros were taxed in recent times. Tax was levied on a fixed return, which, however, with the low interest rates of recent years, certainly could not be achieved by savers[1].

 

The government wants a new tax on the actual return[2], but it will not be there until 2025. "If we do nothing, people who already have a lot of money and become sleepily rich thus risk contributing nothing at all to our society, while the burden on ordinary people increases," said SP MP Mahir Alkaya. "We want to prevent that."

 

According to GroenLinks MP Senna Maatoug, wealth inequality is only likely to increase in the coming years. "We have to break with this policy and tax assets in a fair way." The parties choose to tax the assets themselves and not the fictitious or not fictitious return, as it is happening now.