The Spring Memorandum 2022 (in Dutch: Voorjaarsnota 2022) provides an overview of the current budget year and a preview of the plans for 2023. The government wants to take fiscal measures to, among other things, compensate energy prices and improve purchasing power. One of the measures is a salary cap for the 30% ruling. Please note: the plans are not final, the Tax Plan 2023 will be presented on Budget Day (Prinsjesdag).
What will happen to the 30% ruling?
The 30% ruling has been in the spotlight for some time now. This arrangement has already been reduced from eight to five years. Recently, the rumor was that the tax benefit for expats in the Netherlands would be abolished altogether, but that is not the case.
Salary cap of the 30% ruling
However, the Dutch government will cut back on the 30% ruling according to the spring statement. From 2024, the 30% ruling will be limited to an income up to €216,000. This limit, called the Balkenende Norm, is equal to 130 percent of what a minister in the Netherlands earns. Consequently, the income above this limit is taxed against the highest tax bracket (49.50% in 2022).
There will be a transitional path of three years, starting from 2024. This measure will structurally yield 85 million euros per year from 2026. The cut-back of the 30% ruling is intended to cover a part of the costs of the box 3 ruling.
Other tax plans of the spring memorandum
The salary cap of the 30% ruling is certainly not the only plan from the spring memorandum. In order to compensate for all costs, the budget needs to be adjusted. In this article, we will list the most important fiscal changes that the government has planned for the next and following years.
Abolition of fiscal retirement reserve
The fiscal retirement reserve (FOR) is a scheme for entrepreneurs in the Netherlands to save for their retirement. The government wants to abolish this from January 1, 2023. From then on, entrepreneurs will no longer be able to reserve extra amounts on their balance sheet for their pension.
Increase in transfer tax
It was already decided that the transfer tax rate will go from 8% to 9% in 2023. But in the spring statement, the plan is to increase the transfer tax to 10.1% in 2023. Please note: this only applies to homes that you are not going to live in yourself. For a main residence, the transfer tax rate remains 2% (or an exemption applies under certain conditions).
More tax-free travel allowance
The increase in the tax-free travel allowance is already planned. But according to the spring statement 2022, this will be accelerated by one year. The proposal is to increase this to €0.21 per kilometer by 2023. In 2024, the tax-free allowance will increase to €0.23.
Tax increase for income from Box 2 & Box 3
The plan is to introduce two brackets in Box 2 from 2024 onwards, now there is only one (26%). The idea is to tax Box 2 income up to €67,000 at 26%; the amount that exceeds will be taxed at 29.5%.
The height of the general tax credit is based on Box 1 income. The government plans to change this to the aggregate income (total of Box 1, 2 & 3 income). People with a high income from Box 2 and Box 3 will enjoy fewer tax credits.
In addition, the government has planned that the tax-free allowance (Box 3) will be increased to €80,000 in 2023. According to the spring statement 2022, this plan no longer applies.
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