Income tax rates will increase after all, according to plans from coalition parties D66, VVD, and CDA. The coalition agreement already indicated that income tax brackets would increase less with inflation, resulting in higher tax rates. However, the analysis of the agreement by the Netherlands Bureau for Economic Policy Analysis (CPB) shows that the tax rates themselves will also increase to collect an additional €5 billion.
Due to other coalition plans regarding healthcare, the government receives less money through health insurance premiums. As a result, families will collectively spend €5.7 billion less on premiums, while businesses will save €1.6 billion.
To prevent the budget deficit from widening, the coalition has chosen to raise that money elsewhere. This will be done largely through income tax rates. The coalition wants to cut another €700 million from healthcare benefits.
Health insurance premium
The amount of tax increases resulting from the coalition agreement varies annually, a spokesperson for the Netherlands Bureau for Economic Policy Analysis (CPB) explained. In 2030, the rates for the first two tax brackets will increase by 0.93 percentage points. Currently, these rates are 35.75 and 37.56 per cent, respectively. The rate for the top tax bracket will remain the same.
The lower health insurance premium is more noticeable than the higher income tax. This is because the premium is debited from Dutch bank accounts, while income tax is withheld from salaries. In practice, the two can therefore more or less be offset.
@anp | NEWS BRAINPORT
