National Government softens 30% rule shocker

Government in discussion with the affected Expats

The Rutte government shows signs of heeding to the hues and cries of the sixty thousand expat population.

Earlier, The Netherlands government proposed shortening the 30% rule tax benefit from 8 years to 5 years.  Brainport Eindhoven actively lobbied for the expats alongside other companies and organisations.

The affected expats organised themselves to fight for their cause. United Expats of the Netherlands (UENL) is one such grassroots organisations that sprouted through social media. Eindhoven News contacted the spokesperson Jessica Piotrowski for more information.

Turn of events this afternoon

The cabinet has now agreed to implement the proposed  30% rule tax changes from January 1, 2021. A relief, yes! However, if an expat moved to The Netherlands in 2015 then by 2020 he or she would complete 5 years. So in that case, that expat would still lose about three years of tax benefit. Indeed, the transition arrangement is certainly a welcome decision! Twenty-four months is a good enough time frame to put a game plan in place. Some sources even expect the government to abort the strategy of shortening of the 30% rule.

Legal opinion initiated by UENL shared with the cabinet

UENL Stichting hired the law firm Stibbe (Tom Barkhuysen) to investigate whether the Government can legally implement the proposed changes to the 30% rule without transitional measures. The resulting Legal Document, which was submitted to the Finance Committee, concluded that the proposal is contrary to the principles of legal certainty, predictability, and proportionality.

Advise from Council of State – Raad van State

The council of state (Raad van State) not only advised against this budget proposal but also depicted that it harshly impacts current recipients and their families.  The council also cautioned that the proposal violates Dutch law and could breed future legal action.

Is it time to celebrate?

May or may not be, depends on how many years one has been using this benefit. The government’s news brief only reveals the postponement of the start date. On the other hand, it does not mention whether a transition is on the cards for all existing beneficiaries. More details are expected to emerge when the belasting plan 2019 (financial plan) would be tabled later this week. Of course, it is a  relief for the expats to know that they have time to weigh their future plans. Jessica Piotrowski from UENL  insists that the expats have to wait for the belasting plan to decide on the next level of action.

For Eindhoven News: Beena Arunraj

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