New housing tax will not be indexed

Monday 01 February 2010

The extra tax on houses worth more than one million euros will cover an increasing number of homes as prices rise because the government does not plan to index link the limit, finance minister Wouter Bos says on his weblog.

Describing the plan as 'yet another milestone', Bos writes that the decision to get more and more people to pay the extra charge is a 'fine way' to make sure the 'strongest shoulders carry the heaviest burden' to get the government's finances back on track.

At the moment, some 24,500 homes in the Netherlands are worth more than €1m and their owners will have to pay an extra tax on the value over €1m - up to 2.35% by 2016.

All home owners with a mortgage currently pay the eigenwoningforfait - a 0.55% tax which is supposed to 'counteract' the advantage of home ownership over paying rent. Mortgage interest in the Nertherlands is fully tax deductible.

© DutchNews.nl

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