The Dutch government has concluded discussions about the budget for Prince’s Day, and some more details about the plans have been leaked. One important change for expats in the Netherlands is the one planned for the 30 percent tax ruling. According to De Telegraaf, the government plans to reverse the changes made to the 30 percent ruling earlier this year.

Tax break for expats in the Netherlands to make a comeback

Based on sources from the cabinet, De Telegraaf has revealed that the government has plans to scrap the changes to the 30 percent ruling - a tax break for highly skilled migrants working in the Netherlands - implemented in January this year.

Instead of continuing with the tax break cuts, the government plans to reduce the five-year tax ruling slightly from 30 percent to 27 percent. No other details about the changes to the tax break have been given. There has also been talk about introducing a new lower-income tax bracket and moving forward with plans to increase VAT for many recreational activities in the Netherlands.

No longer scrapping the 30 percent ruling

From January 1, 2024, the 30 percent ruling was limited by reducing the tax break to 20 percent after 20 months, then to 10 percent after another 20 months, after which the tax break of 10 percent would only apply for 20 months more. Many experts warned that cutting the tax break could damage the Dutch economy and be more expensive for the government in administration costs. 

Government plans to scrap these changes and any other financial plans for the country for 2025 will be announced on Budget Day on September 17. 

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