The Dutch 2017-2021 coalition agreement: Key tax aspects

The Dutch coalition agreement for 2017-2021 was published on 10 October and, in fiscal terms, it contains a number of notable points:

  • The introduction of a withholding tax on royalties and interest derived from sources going to countries with extremely low tax rates;
  • Income tax rates are set to be divided into two brackets (36.93% and 49.5%) while tax credits will be raised (keeping with the tendency in recent years, with the apparent ultimate goal being a flat tax);
  • Lowering the corporate income tax rates;
  • Raising the low VAT rate from 6% to 9%;
  • The tax on notional return on investment will more quickly match the actual return (box 3);
  • Raising the material interest rate (box 2) in stages from 25% to 28.5% by 2021. 

The actual text of the coalition agreement concerning the proposed overhaul of the tax system in the next few years can be read here

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